Melt up?

Every once in a long while the market tone gets very bearish and individuals and institutions become so cautious they maintain a very defensive portfolio and carry lots of near cash positions rather than stay fully invested. Sometimes the market then begins to rise for no apparent reason. Usually descriptions like bear market rally, or correction, or pause are used to explain the action and not many jump on board the upward move. But the market keeps crawling upward and institutional fund managers find themselves underperforming the market for a quarter. Then for a part of a second quarter they still stay out they fall further behind and start to get a little nervous, but earnings season is coming and the market moves a little sideways. The fund managers are reassured the bear will resume or at least weak earnings will give them a sharp correction they can use to get on board.
But lo and behold the earnings period doesn't break the market and a crappy GDP number not only doesn't break the trend but buyers drive the market up sharply and a month in to the second quarter these fund managers really are way behin with less than 8 months to catch up and get ahead of the market. Now jobs are on the line. Soon the "Melt up" begins. An overbought overstretched rally turns into a frenzy as fund managers capitulate on their bearish ideas and buy in with waves of panicky buy orders. The market shoots far further than is justified in a fairly short period of time till the funds are more properly positioned for and up move. And just as suddenly the bull is over, vanished, gone like the wind. The bear resumes.
In 35 years in the market I have seen this once or twice. I think we may see it again very, very soon.
Be careful out there!