Bears Turning Into Bulls? Here's Why

Well, what does it mean when some well-known bears have suddenly turned rather bullish? Good example: Laszlo Birinyi, who put out a note late yesterday. His position--the market is in a range of 1350 on the low side and 1500 on the top. That means, at 1,360, he believes we are essentially at the bottom. His reasoning:

--Half of the ten S&P 500 sectors are at the absolute bottom of their trading range.

--Earnings have generally been good, with some notable "home runs" such as Microsoft ,IBM , Conoco , and Monsanto .

--Housing stocks appear to have bottomed.

--Many economic sensitive stocks are acting well: Cummins , Caterpillar , and U.S. Steel, for example.

--Natural buying is returning; that is, recently short covering (like financials) was the primary mover of stocks, now there are more natural buyers

Birinyi's bottom line: "a churning market within a wide range, but with an upward bias."

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