I thought tonight I'd comment on what I expect going forward for stocks. The patterns in the major indexes are similar but I'm going to focus on just the S&P 500.

Do you remember the running triangle I mentioned a little while back? If you remember I said it was a continuation pattern and was suggesting a continuation of the prior trend, which was down.  Well, it activated and is in the process of trying to fulfill it's downside potential. There's no guarantee it will, but these patterns do generate targets they seem to try and meet.

To come up with a target you need to do some measuring at the widest point of the triangle. This would be from the early November high to the November low. I'm not going to give you the exact number. I want you to figure it out. Just know it's over 200 points. 

Then subtract that number from the breakdown point of the triangle, a little over 800. You get a number under 600. That's your target. E-mail me with your guess of the exact number and I'll let you know if you're correct. 

There's a better than even chance that the market will move near this area in the coming days. This should mark (at last) the end of this first wave decline. After this I expect a move higher for few months and then a move to (perhaps) a final price low in late 2010.  
That's when the next 4 year cycle is due to bottom.

Know that I'm not married to that scenario. It's just my best guess right now.

Gold is weakening as I expected. It should weaken significantly in the coming days and weeks. The dollar continues to break higher.

Wild cards to watch for that could have a major impact: an announcement modifying mark to market accounting rules, a suspension of the down tick rule, a Fed announcement that they're considering purchasing stocks on the open market, a Fed announcement that they're going to buy treasuries on the open market to drive interest rates down.