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(March 25, 2002) STOCK INDICES: S&P 500--It seems that while analysts, brokers, and other market pundits are feeling good about the stock market; not many CEOs are having the same euphoric feeling. 2001 has had a record number of bankruptcies, charge-offs, and write-offs of "implied goodwill." This should have people re-thinking the Q1 earnings estimates because in anticipation, the market has taken it on the chin in the last week or so. It looks as though the "feel-good rally" of the last few weeks has failed and reality is about to set in via earnings reports.

I am looking for continued selling pressure throughout this week. I believe the market will head to the natural support at 1125.5 in the next few days. A convincing break of the 1125 area next week will be needed in order to keep the bearish activity going.

RECOMMENDATION--My recommendation last week was to sell a break below 1153. I recommended a risk up to 1163 and would implement a trailing the stop down to the 1125 area. For those entering this week, I would recommend pick a spot today, 3/25/02, and attempt a short sale. I would not recommend a risk a trade tic of greater than 1158.

George Skirha

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