Market Analysis for Jan 26th, 2004

Today has shaped up to be an extremely quiet Monday, not that it's unexpected because Greenspan gave a speech earlier in the day. Not that he said anything important but he did put a damper on anybody who's looking to make any important decisions, especially since he's going to be the center of attraction tomorrow and Wednesday as the Fed meets for one of its two-day meeting.

So it's conceivable the market is extremely quiet ahead of Wednesday's 2 pm Eastern time expected announcement by the Fed that they will not change rates. The question is, Will the Fed change the wording of the statement about the rate structure and the economy?

Chances are they'll do nothing. My sense is that with oil prices down 70 cents today and nearly $2 off of the high since a week ago, that oil prices are the key market we should be focusing on now. If oil prices come down, I think that could give another stimulus to the stock market -- to equities -- because if oil prices come down for argument sake from 35 to 30 or 28, that's a big and significant "tax cut" that the economy could use to continue growing at 4-5% into the election, which is probably exactly what the Bush plan is.

Having laid that out as background, my work in the E-mini march S&P suggests that if you can't get them to go down after Friday's decline from 1149