We will be featuring a new video on Tracking Spike Performance this weekend!Here is this weeks full results.

The markets headed down early and continued their descent throughout the day. More worries about tomorrow mornings unemployment report and more talks of GM’s potential to enter bankruptcy helped push the markets lower. By the end of the day the major indices were trading at levels not seen since 1996.Financials was sold aggressively again today as Citi traded below $1. WFC was down almost 16% for the day. JPM was down 14% for the day. It was a very bad day for financials. Tomorrow morning we get the Employment report. Consensus expectations call for nonfarm payrolls to fall by 648,000 and the unemployment rate to rise to 7.9%.

Dow Jones Industrial Average snapped a five-day losing spell, rising 150 points after a market rally in China spurred by hopes for a new economic stimulus package in that country. All sectors were green for the exception of the bank sector. The S&P 500 Index climbed back above 700. The ADP nonfarm payroll report is calling for a drop of 627,000 in private payrolls. The employment report is this Friday.The ISM non-manufacturing index fell to a 41.6 level. Friday’s unemployment index may not be as disappointing as many believe it will. With the very oversold condition of the markets, an unemployment number that is better than expected may provide for good rally. The business activity index was down by 4.4 points from January’s rating. It was 40.2. New orders also fell. On the plus side the numbers were higher than they were in November and December. We have been expecting a rally with the markets being so oversold. Today we got it. We need more of them in the coming weeks. The question now is whether or not we have more upside from here. The good thing is the Index Put Call ratio did NOT drop below 1 during today’s rally. This indicates that traders did not rush out and embrace this rally too quick. The percent of up volume moving average recently dropped below 40%, it sits at 42% and has room to move up. A reading of over 55% becomes overbought. The McClellan Oscillator has a bullish divergence in play and continues to be oversold. If intraday supports can hold this may lead to more upside as shorts go to cover. The shorts seem to have gotten a bit relaxed as selling rallies have become the norm and no rally has lasted for more than a day or two. The key will Thursday and Friday and holding up thru the employment number.

In a day of many Government figures taking to the air waves the major indices tried to rally from a very oversold condition but weren’t able to wave the rally towels for more than a few hours. The Treasury and the Fed are launching the Term Asset-Backed Securities Loan Facility (TALF) which they suggest can potentially provide up to $1 trillion in loans for businesses and consumers.On the economic front, pending home sales in January fell 7.7%, much worse than the expected 3.5% decrease. The economic news continues to look bad. This market needs to see a strong bounce from these oversold conditions. Meandering around at the lows and consolidating will likely not sustain any kind of bounce that will hold. It would be a negative sign to work off oversold conditions while churning. Anyone (including myself) that has been attempting to trade for an oversold bounce has been getting stopped out or is sitting under water. These traders will get gun shy as the lows continue to grind out and many will stop trying to trade for the bounce. This is what the market needs in a way, as traders attempt to trade off the lows and there are no bidders willing to bid up and buy at higher prices… these traders have to turn and sell. If there were no traders to sell at higher levels, there are likely no more bottom fishers to sell to either so they have to sell at lower prices along with the momentum short sellers. When this occurs the market is driven to new lows. Eventually an oversold rally will appear and when we get one that can run for more than a day we will likely see a fierce move run up. For now we continue to struggle with finding any traction to hold as the markets are showing no confidence in the remedies suggested by Washington. We need a good excuse to rally, and we had appearances by both Ben Bernanke and Tim Geithner to help provide one. Neither had anything much new to say and the market failed another intraday attempt to generate the elusive oversold bounce.

News of additional bailout terms for AIG after it lost $61.7 billion in the fourth quarter set the stage for another day of selling on Wall Street. Warren Buffett felt that the US economy would be in "shambles" for the remainder of the year after suggesting late in 2008 that buying US stocks would be a good idea. The Oracle of Omaha had his worst year in 2008. The major indices responded with the DJIA falling to levels last seen in 1997. The SP-500 fell to 1996 levels after the worst first two months in its history. We cannot get any kind of catalyst to give bidders reason to bid up for stocks. Any strength or bounce is sold as we continue to drop to lower levels.

Even when I am busy with some office work, I like to have a 25-minute chart of a stock I am trading on an auxillary screen on the side of my desk. It gives me a sharper image of the market than a daily chart, without getting into a head-spininng detail of a 5-minute plot. The 25-min chart of the S&P cash, shown below, reveals the details of some of the recent turning points.