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How are the markets looking before today's Fed decision?

* Finding Hope - We've seen ferocious rallies off the lows for two of the most beaten down sectors: homebuilders and banking issues. Both are up over 20% over just six trading sessions. The housing sector has recovered nearly all of its drop since December, suggesting that some on Wall Street may be looking beyond the anticipated continuation of weakness in 2008.

* Continued Strength - On Tuesday, we saw an expansion of fresh 20-day highs to 797. New 20-day lows remained low at 215. Momentum remains positive as well: We're now seeing 26% of $SPX stocks trading above their 50-day moving averages, up from 8% at the market lows. Shorter-term, my measure of Demand closed Tuesday at 109; Supply was 23.
Source: Here's Hope: Homebuilders and Banking Sectors Rally