Before the Open (Jan 28)

Good morning. Happy Thursday.
The Fed has spoken. They said the economy continues to slowly improve, and rates will be held at a rock-bottom level for a long time. The market initially chopped around, but then it got some legs and rallied. When the dust settled, the indexes were back in the middle of its 3-day range.
When the week started, the short term trend was down, but now it’s been neutralized. Some short term indicators are at levels that produced bottoms in the past, so the next couple days will somewhat serve as a litmus test. If last week’s sell-off was a pullback within an uptrend, I’d expect the market to bounce soon. But if the character of the market is changing, if last week’s sell-off was the beginning of a bigger, extended move down, I would not expect the indicators to work as they have.
Here’s the SPX daily showing what I consider to be a bear flag. A measured move down is to 1030 which coincidentally happens to be the Nov low. But as you can see from the Sept, Oct and Nov lows, the market doesn’t need to base very long before moving up. When it moves, it moves fast and uninterruptedly.

And here’s the 5-min chart. If the index moves up today and tomorrow, potential resistance comes in at 1105 and 1115.

headlines at Yahoo Finance
today’s upgrades/downgrades
this week’s Earnings Reports
this week’s Economic Numbers