There is a potential market mover pre-market tomorrow morning when Europe's Bank of England decides whether they will once again cut rates. Yes, I said cut, not raise. The endless world of low rates, and sometimes even negative rates continues. The expectation is for an actual .25 rate cut. Hard to believe, but that's the world we are living in now. How low can rates go? It seems there is no end to it all. We don't have to understand or agree with it, but that's the real world. It's true insanity. I'm not sure how they can get away with this garbage, but I think their market would collapse if they didn't do another rate cut in the world of endlessly low rates. I can't wrap my mind logically around it, but they seem to have no problem doing so. It shows the truth of how bad things are economically.

They're not good and they're not getting better as they would like you believe. If things were truly improving they wouldn't be expecting another rate cut. That's the truth of things. The question is what their market will do once they do cut rates. Sell the news? Love the news? We'll know soon enough. And, of course, we should follow their futures to some degree, so it'll be an interesting morning here in the United States. We don't follow them fully except when there's big news, and this rate cut, or not, is big news. How their market responds is big news. So much of an unknown. So be prepared for something pretty big out of England in the morning. An interesting day ahead is coming. With the market struggling to hold the 2134 with force, this will be a very important moment with regards to us holding the breakout the market waited for so long. Some fireworks likely in the morning.

The market breakout has been nothing short of a failure, thus, far from this perspective. Yes, we're holding the 2134 breakout, but it's weak. The breakout above has NOT caused a rush in to buy stocks as most important breakouts have in the past. To only get two percent higher after a few weeks of breaking out, and now barely holding one percent, is awful behavior. Is it the monthly negative divergences? Is it the poor economic conditions globally? Is it over valuations? Could be any and all of those and more, such as an increase in froth. All this said, we're still on breakout and that's the bottom line, weak or not. The bears need to eradicate 2134 to turn the tide more in their favor. Maybe the European announcement will go their way.

The bulls need to apply the pressure here to get the market towards 2200 and somewhat beyond to confirm the breakout with a bit of strength behind it. The longer the breakout remains weak the more likely it is to fail over time. If it does fail it shows some truths are starting to come in to the market and that's the last thing the bulls want. truth will stop the bull. It needs to hold Disneyland. It needs to break above 2177 with force and plow through 2200 to keep the bull lie alive. Tomorrow should be very interesting.

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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