Don't be distracted by Congress and Oil spewing and if Lindsey Lohan is drinking. The Markets is in the middle of its counter trend bounce and clearly the trend is lower. If you look at some simple technical indicators you can see the picture.
We made a high on April 26th and a low on June 8th. All the noise in between is a dead cat bounce. Most importantly the momentum indicators are all overbought in this bounce. Many will point out the 200 day moving average, but in my experience this indicator is often violated and is more directional.
My advice is to watch the upcoming earnings numbers for retail and best of breed, I believe what you will find is an exhausted consumer who no longer has home equity or Tarp money or unemployment benefits. Jobs are shrinking and the under employment numbers are staggering, never everyone I talk to is working a job below their skill levels.
Summer rallies in the past have surprised many professional traders with the strength of these rallies, but there is a different mindset among long term baby boomer holders who have been down sizing and looking for part time jobs to augment their lifestyle. I don't view any of this as doom and gloom , I view this as the evolution of a mature economic system which is the US economy.
To view this article at World Market Media click on the link below: http://www.worldmarketmedia.com/779/section.aspx/1878/post/the-us-market-is-technically-vulnerable