"Ouch"… those less than stellar Oracle earnings is going to hurt in the morning. Oracle is another one of those companies that the markets looks towards for guidance and clues to how the business world is doing. Everybody has been spoiled in the past to Orcale always beating their numbers and providing a rosy outlook, well they did not give that this time and their stock lost 8.3% after hours. That should have an impact on tomorrow’s market.

Tomorrow at 8:30am we will get the final Q4 GDP data as well as the weekly jobless claims. Should prove to be an interesting morning. Today it was all about the financials, again. Multiple downgrades of financial companies last night (which we posted in last nights commentary) in conjunction with the bad durable good data this morning just was too much for the market to do anything with except pull back. And speaking of the financial sector tonight we just got this off the wire…

UBS 

Q1 EPS EST REVISED TO -$2.75 FROM +$0.72 AT OPPENHEIMER; EXPECTS A Q1 WRITEDOWN OF $11B

Merril Lynch (MER)

Q1 EPS EST REVISED TO -$3.00 FROM +$0.45 AT OPPENHEIMER;  EXPECTS A Q1 WRITEDOWN OF $6B

It was Oppenheimer who downgraded other financial institutions last night, and they are now downgrading even more tonight. Oppenheimer is one of the more conservative analysts out there, so when they downgrade… people take notice.

Resistance levels we highlighted in the charts have been fairly strong and keeping the market from advancing. The market feels like the old game that was popular here in the United States when I was a kid (ok, no jokes.. it was not when the dinosaurs roamed the Earth). The game was called "Kerplunk" and it was a plastic tube that had a bunch of sticks in the middle of it with a load of marbles stacked on top. Each person took turns pulling one stick from the device until the point is reached where the final stick causes all the marbles to fall. That is how the market is behaving, each bit of economic data, each earnings report, and each piece of bad news is just one more stick being pulled. What or who will pull that one stick that makes all the marbles fall?

As Lisa said in her closing remarks, the Bear Stearns (BSC) ordeal is going to get ugly with the United States Congress now getting involved. Mind you, we feel they should get involved because the entire situation with BSC needs to be investigated. The Federal Reserve along with Treasury Secretary Paulson need to be put under the spotlight and find out what really happened. Karl Denninger has studied the US Securities laws and he feels laws may have been broken (as we do also) and he is covering this situation in great detail. Be sure to check out Karl’s commentary every night.

The US Dollar has fallen by quite a large amount over the past two days and is not far from hitting new lows again. While the daily ups and downs of oil and gold prices seem to get a lot of attention in the press, one things needs to be clear, and that is oil and gold are on a long and healthy bull trend. While there will be pullbacks in oil and gold over time these commodities will continue to increase in price over the long term. Some very good analysts have oil reaching $250 per barrel by 2012. Some may say "that can’t happen", but remember people said the same thing 5 years ago way analysts were saying oil would reach $100 per barrel… and that became reality.

We are sill holding our short position on the Dow Jones Industrials (our entry was 12750). Let’s see what tomorrow brings us.. should be another interesting day. We must not lose sight of the world markets. Remember that global markets are firmly in bearish territory and this says a lot about the health of markets in general.