Weekly Update 01-19-2010:

Last Thursday may well have been the top to last year’s rally.  However, the selloff on Friday ended up on a support area of around 1130’sh on the S&P500. This pause should lead to an impressive move. There are some possible Bullish patterns that I have been following for weeks that suggest possibilities that the S&P 500 could top out two or three percentage points from this current level, which would allow for a sharp rally from here. However any rally from here could be held back by strong developing Bearish forces that have been prevalent for months now and are increasing by the day. It means going long here would require very nimble risk management controls due to working on a very slim Risk Reward target. Beyond that are dark storm clouds warning a significant top is either in as of last Thursday or is fast approaching. The entire topping process seems to be occurring in slow motion, which is typical for large tops.  In order to get further confirmation of an uptrend top the SPX needs to either break below the 1133 pivot area and head towards the 1107 area or, if this rally has one more spurt in it then it should hold the 1133 area and then make its run.  If it fails in its next rally attempt then we have likely seen the highs for this uptrend as of last Thursday.  We should know most likely this week.  Until then we will wait in CASH.  Yours for Safe Sailing in Bull and Bear markets.