Calling A Bottom

Good morning. Following big rallies in overseas markets, premarket futures are showing some optimism this morning. A batch of not so bad earnings and better than expected weekly jobless numbers are helping along with the great hope that the market has already hit bottom.

Premarket gainers: NOK, MBRK, ADLR, SYMC, FFIV, POT, QCOM, SHFL, HGSI, GPCB, WDC, MOS, FFIV, PLCM, NVEC, TRMB, PLXS, HCBK, CRFT, GRMN, TRA, MICC, MBRK, CTXS, MRVL, YHOO, GILD, AAUK, and RIMM.

Premarket losers: EBAY, SPWR, FSLR, CY, SOLF, STP, CSIQ, LEN, THQI, MRCY, FTK, ITWO, ACH, ESRX, BPOP, JASO, HOKU, ESLR, and OREX.

The last economic report of the week - December existing home sales - will be reported at 10:AM. After that, the focus will remain on earnings, especially after the closing bell with reports from Microsoft (MSFT) and E Trade Financial (ETFC), among many others.

It will be useful to see how much momentum the bulls can sustain in this bounce and whether the same sectors provide the leadership. The solar stocks are really getting creamed in premarket trading as speculators move on to the worst performing sectors for short-squeeze/oversold plays.

The media is calling a bottom, but then again, they've been doing that for several weeks now. The big picture overall trend is still down and the market is still broken. Until that is repaired, rallies (even like the one we saw yesterday) are not to be entirely trusted. Instead, use them for quick trading opportunities, to raise cash and reposition if needed, and/or look to deploy shorts at higher levels once we remove the oversold conditions. Have a terrific Thursday.