The S&P futures bounced around on Friday to end the session with slight gains after the U. S. reported slightly better than expected Trade Balance and Consumer Sentiment data. Even though the numbers beat expectations, the data is still dismal and indicates heavy economic contraction.

The U. S. will release some more significant monthly data this week, highlighted by Building Permits and PPI on Tuesday followed by CPI on Wednesday. Investors are becoming increasingly concerned about the level of prices in the U. S. economy. A worst case scenario would show excessive growth of producer prices coupled with dropping consumer prices, raising cost and lowering revenue.

Equities are looking to open higher again Monday with the S&P futures trading in the green pre-market. While many investors are amped over the extraordinary gains posted last week, we still see key fundamental obstacles in the near-term. Do not forget last week's rally was ignited by psychological diction emitted by financial CEO's and Obama with little positive concrete data to back up the claims.

In fact, Germany released some appalling economic data while Japanese and Chinese production figures left little to be desired. The futures are gradually approaching February highs, our 3rd tier downtrend line, and the psychological 800 level all at once. Hence, the decision of whether turn this rally into something substantial is approaching this week.

The U. S. may pull another psychological weapon off of the gun rack this week by releasing a plan to tackle the toxic debt on bank balance sheets. The equity correlations are painting a distorted picture. Crude is moving lower following OPEC's decision to keep output unchanged while gold is behaving in an ambivalent manner.

The 30 Year T-Bond futures are trading lower following China's lack of conviction concerning the attractiveness of U. S. debt. Therefore, the equity correlations provide a mixed outlook. Fundamentally, we find resistance of 760.75 with additional resistances hanging at 771.5, 778.75, and 793.5. To the downside, we see support of 760.75 with additional supports sitting at750, 740.5, and 732.75. The S&P futures are currently trading at 764.50.

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