S&P 500: Weekly Update

The 800-825 support continues to be the "line-in-the-sand." Stimulus bill has been approved by Congress and President Obama will sign it into law on Tuesday. According to conventional wisdom, we buy the rumor and sell the news. Therefore, I guess Tuesday, (markets are closed on Monday) will be a very interesting day. Also, the Federal Open Market Committee (FOMC) meets this coming week.

GM is reporting in Saturday's WSJ that it will offer Congress two choices: Bankruptcy or More Billions. Is anyone really surprised by GM asking for more BILLIONS? According to the WSJ, the Treasury reports that GM probably needs an additional $5 billion to continue its operations beyond the first quarter. Of course, the thorn in this entire process is the "legacy cost."

Note: To enlarge, double-click inside the chart. Note: To enlarge, double-click inside the chart.