The market had a good chance for a good day yesterday but fumbled the ball. The DOW was up 125 but finished down 100. The NASDAQ was up a whopping 120 but finished flat. We are never thrilled when markets reverse down but today is another day.

Futures have moved up nicely in the past hour after being down to flat. As we write this, the DOW is up 160 with the NDX up 50.

There are a few things the market has going for it.

Firstly, the DOW dropped 1,000 points and the NASDAQ dropped 366 points since Thursday. Stocks do not go down forever…we think.

Secondly, our A LOW call from 3 Wednesdays ago still stands. Those lows have not been broken.

Thirdly, we are in a seasonal strength period. This does not guarantee a good market but in the past, the end of year action has a good record.

Lastly, seeing some decently high bearish readings indicating AFTER the drop, the masses are finally getting worried.

Combine and at any random time, we can bounce. Today’s open is as good as any time but just remember, they reversed yesterday to the downside.

The big picture has not changed. Most everything continues to trade below the 200 day average and what leadership there is remains defensive. Let’s just hope the A LOW turns into THE LOW but expect a lot more back and forth before any real attempt to get going.

And Germany just announced a shrinking economy…9 months after the German Dax topped with just about all of Europe. Remember the thesis that markets are pretty darn good at telegraphing the shape of things to come.