SPX The market is at an interesting crossroad. There are two potential Short Term (ST) scenarios that can develop. Currently, the SPX is in a bearish channel, as the market deteriorated since September. We are currently testing the upper resistance level of this channel. A break above this level would lead to a rise to a resistance area (1054)created by the bearish channel from earlier this year. Failure to break above this ST resistance area would lead way towards a new low, around 700.

Given yesterday's Fed move, the following rally, and today's reaction, I think we may head lower rather than breaking out. Again, it is the end of the year, and also a new beginning in 2009, so it will be interesting to see where we head in the meantime. Remember, we have a lot of problems still in the economy, which still has yet to see some clear signs of the clouds clearing.  ¶ 3:38:00 PM