The Weekly Report for December 15th - December 19th, 2008

December 14, 2008- Market Summary
In our last couple of reports, we've been mentioning that the major indexes, such as the S&P 500, have started to rebound off their recent lows. We noted that many were using this as a sign of a bottom in the market, but, as you can see from the charts below, each of the indexes have retraced toward the resistance of their respective 50-day moving averages. The nearby resistance gives us reason to believe that it isn't time to bet on a reversal quite yet. A period of sideways price movement, like what we've seen over the past couple of weeks, is common in a strong trend. Keep in mind that this could be a period of consolidation before the bears send the markets lower again.

The high level of volatility that has been present in the markets, combined with weakening fundamental and economic data from across the globe, makes it extremely dangerous for anyone to predict how long buying pressure will last. The safest bet is to remain on the sidelines.

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