Those looking for some Monday morning relief were disappointed today as the market continued with a slow grind lower. There is no sugar coating the action from the front lines as this is not a good tape.

The action reminds us of this past December as we held strong despite a slow drip lower as participants waited for a Santa Clause rally that never materialized. When the year finalized and all had given up hope, Santa appeared albeit late, taking us higher at a very rapid pace.

The question we are grappling with is what will be the catalyst to spark a rally? Will it be a wash out? Will it be the new Fed Head Dr Bernanke's comments at his first Congressional appearance? We aren’t quite sure, but can’t shake the feeling that we want to hang in there for now rather than go heavily to cash and stand aside. We suspect that many did not participate in the January move and now after this relentless fade, find themselves negative on the year. Should Mr. Market decide to take us higher, we believe we could see a lot of poorly positioned, underperforming investors push us up fast and furious as they scramble to buy.  .

As we approached the close on the day we saw some buyers step in. Perhaps it was just some short covering but we were a little encouraged to see some tepid positive action. With Dr. Bernanke is scheduled to appear on Wednesday and we believe the market may find some footing as it awaits even some remotely positive comments.

Have a good evening.