Battle Week Coming

As mentioned in previous post, next week could prove pivotal for either the bear or bull camp. Except for the eighteen trading days from Sept. 18th to mid Oct. 11th, the SP500 spot futures has been trending lower. Since mid July 2007, the spot futures technicals have been soft and might have finally entered the exhaustion phase this past week. A bottom will take some work while a failure will produce more selling from a slowly emptying liquidation pool. The battle line for the Dow Jones Industrials, SP 500, and NQ100 will be closing above the August lows. That is not very far for the Nasdaq 100 but around 2.5% to 3% for the others respectively. Stimulus for the Fed and or Congress has basically been priced in and now the issue will be whether or not the price construct will form to support a run in 2008. Something very few are looking for. The bears have the upper hand but are vulnerable.