Mostly extents of sell programs were seen Monday. This means a selling entity was present virtually all day providing a down trend environment. This is a reasonable expectation given the extent of the rally that covered over 160 S&P points upward. The interest rate outlook for the short term was oversold, as we declined nearly 10 full points from the 147 highs of the year. The bonds should make a declining top. However, we do not know where that failure will occur yet. Stay tuned and be alert! Tuesday afternoon displayed numerous plus 1000 ticks demonstrating that the buying is constantly present, while the selling is very intermittent. We journeyed above 1215 and now we are once again attempting to move to that plateau. This time if we close above 1215, I think the trek to penetrate the 1230 will have more energy and a mission. The shorts have not been eradicated as of yet and that will probably be a requirement before this intermediate rally has concluded. If the stocks move through 1230 we should see the bonds below 137. That is a correlation that we must pay close attention. There are no mild gentle showers in this stock market anymore. It is either sunshine or a monsoon. Wednesday afternoon following the Beige Book, this market was hit with the monsoon of high minus ticks. Your diaries should record the day as we saw 12 straight minutes that every minute recorded a reading below minus 1000. This market seems to be a Dr. Jekyll and Mr. Hyde at least this week. The bonds went in sympathy with stock prices, especially when the drop occurred that pushed the bonds to their high at 139 ’28. This represents a short covering price area that will be a reference. The bonds have energy as their swings are many times more than one point, but the net change for Wednesday was minimal. Thursday morning showcased a huge pendulum swing between the minus tick and the euphoric plus tick of midday. This swing generated 20 points between the highs and the lows, expelling much energy. The rally was attributed to positive news from Europe. Once again it did not build, but rather erupted and exhausted the up move on the news. The bonds are defining resistance and support areas--141 as a breakout and 137 as a breakdown. Expirations are not an accurate gage of the overall market environment. We journeyed above 1230, which had been a critical resistance for many weeks. The fuel could very well be expiration unwinding, not constituting a strong foundational source of energy. A reversal beginning next week would not be surprising to undo what this rally did Friday. I put very little credence in movements of expiration Friday for overall evaluation of the intermediate term. The bonds did not go lower with the stock market penetrating the 1230 area. Therefore, we are seeing a divergence whereby the bonds are holding their prior pullback lows at 137 1/2 as they just touched above 138 on Friday. I am concerned that the bonds have an artificial underlying bid once again keeping them from true free market swings.