My friend D7 at freetradingvideos.com did a great wrap-up video last night... It's a must see.
Something that nobody seems to be mentioning is that the last day President Bush was in office, the SPY closed at $92.85. That level was tested on the 7th, and 8th of May. On the 8th, the market actually did close above that level ($92.98). The theoretical line in the sand then failed. Yesterday made a high only 5 cents below that.
Somehow, I can't see how market fundamentals have improved since then. Therefore, I expect a significant pullback.
D7 and I agree that it is early to place your investments... that would be betting. Like he says in the video: "trade with your eyes not with your mind."
Here is a 60 minute chart of FAS:
Click for larger, browser back.
Is this a Head and Shoulders forming?
This could indicate a small recovery and pull-back in the making.
A downtrend in financials can pull the rest of the market.