Dave Fry's Market Outlook for Tuesday

Hank Paulson is busily twisting arms and putting “a deal” together to rescue some mortgage holders and subprime borrowers. When and if completed, the details, if ascertainable, will be much scrutinized. We might be able to rely on our friend in the image above to tell us how it all might work out.

In the meantime investors are already tense, awaiting both employment data on Friday and then the Fed the following Tuesday. We might not get too much action before Tuesday but if employment data is exceedingly weak then investors will expect, nay demand, a 50 basis point cut in the Fed Funds rate.

Volume was relatively light while the advance/decline data was decidedly negative.

The other major domestic indexes have this same look--stuck and awaiting the next piece of the puzzle. But the problem children have still yet to bust their downtrends.

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