The Indexes ended mixed today as Bernanke testimony continued to sound more worried about growth rather than inflation and left the door open to more rate cuts. That really means he is seriously worried about the banking system and the consumer who has been virtually responsible for all of the economic growth over the last ten years. If the job market were to worsen appreciably, the financial outlook for the US could become unclear and possibly worse than imagined up to this point. Further, the US dollar continues to slide against the Euro in direct response to the Fed's interest rate inclination. New home sales sunk to a new 13 year low and banks may soon find themselves in a mortage bind do to a class action suit soon to be decided upon in federal court.
The bulls need to take this market to the next level higher or face the test of the lows. Testing the lows has been viewed as a buying opportunity by some trend traders, but it is one thing to talk about and another to act when the market gets there. In trading, the expression is Cancel If Close.
