So Thursday we're up 180 points after struggling just prior. The market is ready to blast out, right? Well, not exactly. You see, in an agnostic, sideways, unwinding situation you get a lot of head fakes both ways. You think things are bad and then they rise. You think things are good and then they fall. This process continues the medicine the market needed, which again, was two-fold. Unwind overbought and very top heavy oscillators and unwind too many bulls, and thus, get more folks bearish or least unsure of themselves. Days like today are so good for the bigger picture in that it made folks angry.

Wasn't it just yesterday we were up one hundred and eighty points? Doesn't that mean, since we're in a bigger picture bull market, today will be up huge? More unwinding in sentiment should be with us when we get those figures on Wednesday of next week, possibly decently below 20% after just being at 36.4%. When price deterioration is small relative to the unwinding in sentiment and oscillators, that's a huge positive for the bigger-picture bull market. So yes, today was a disappointment, and I must say, it was good to see because when you disappoint to end the week, the feelings over the weekend aren't good and that's great for the bulls.

The market is likely waiting on the Fed to see what he has to say about his liquidity machine next Wednesday. There have been foolish rumors about his putting an end to the madness. Sadly, with the economy struggling badly, that won't be the case. Sadly for inflation, but not sadly for the stock market. The last Jobs Report was healthy only from the perspective of temporary jobs. Not from real, longer-term job creation. The Fed has said over and over that until he sees employment do what we all want it to do, which is to grow with real jobs consistently, he will not be putting any stop to the liquidity machine. Not on any level, so it's my belief that he will relay that very message to the street next Wednesday.

How the market reacts is a real unknown. It may still not be ready for the bigger push higher just yet but we can't really know that for sure. We are in a bull market thus any reaction is possible. Oscillators have unwound decently on the daily charts although they could use more work on the weekly ones. RSI's on the weekly-index charts are averaging still roughly around 60. Lower would definitely be better, but with the daily charts unwound the market may respond positively to good Fed news. We shall see, but it'll be interesting for sure. The Fed is not likely to disappoint.

Those 50-day exponential moving averages have held on this test lower. The market held and rallied, but with today's losses, we're still fairly close to those key levels. The numbers being 1613 and 3384 on the S&P 500 and Nasdaq respectively. If those levels get taken out because the Fed doesn't give the right signal to the bulls, we could easily see a retest of the 1575 breakout. Not likely but always possible if the wrong news hits. There's overall solid support from S&P 500 1613 down to 1575 with moving averages, horizontal support, trend lines and gaps. It won't be easy for the bears to break this down and they will need the right potion of bad Fed news to get the job done. In the meantime, the whipsaw, healthy whipsaw at that, continues for now and probably will until we hear from the Fed on Wednesday.

Have a great weekend.

Peace,

Jack

Jack Steiman is author of SwingTradeOnline.com ( www.swingtradeonline.com ). Former columnist for TheStreet.com, Jack is renowned for calling major shifts in the market, including the market bottom in mid-2002 and the market top in October 2007.

Mr. Steiman's commentaries and index analysis represent his own opinions and should not be relied upon for purposes of effecting securities transactions or other investing strategies, nor should they be construed as an offer or solicitation of an offer to sell or buy any security. You should not interpret Mr. Steiman's opinions as constituting investment advice. Trades mentioned on the site are hypothetical, not actual, positions.

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