The S&P futures are getting hit by some profit taking pre-market after Monday's energetic rally. The S&P closed up over 7% while being led in large part by financials.

The toxic asset plan was clearly accepted by investors as analysts hope creating a market for Mortgage Back Securities will help price and remove some of the derivative debt from bank balance sheets.

The Treasury is hoping that removing toxic assets from the balance sheet banks will help ease credit requirements and get loans flowing again. On the dark side, the toxic asset plan is complex and requires a large amount of participation from private investors.

Furthermore, isn't leveraging private investment by up to 6:1 while investing in risky derivatives what got us in this mess in the first place? Also, how great of an exposure will the government take when all is said and done, and will the government be able to back out of the system after the market is settled?

While we are simply thinking to ourselves, we believe these are issues that should be considered. Despite any uncertainty regarding the success rate of the toxic asset plan, the S&P futures surged through key fundamental and psychological barriers yesterday.

Eclipsing our 3rd tier downtrend line and the highly psychological 800 market, the S&P has positioned itself for more near-term gains. However, we notice the volume being registered over the present rally has lacked the significance of the volume during the crash.

This observation raises a cautionary flag in the background. The next challenges will be February highs and the psychological 900 zone. While Crude and Treasuries exhibited their proper correlations with equities, the movements were marginal considering the percentage gain in the S&P futures.

However, Gold is posting some large losses, heading below our 1st tier uptrend line. In all, the correlations are showing we can't be sure just how far north the equity rally will take us.

Yesterday's equity rally was fueled by a slightly better than expected Existing Home Sales number. The U. S. will take the day off from economic data until Wednesday's Durable Goods Orders and New Home Sales. Don't forget the U. S. will announce its Final GDP on Thursday.

Fundamentally, we find resistance of 812.75 with additional resistances hanging at 822, 829, 836.75, and 844.75. The 850 level becomes a psychological barrier. To the downside, we see supports of 804, 794.5, 790.25, and 782.5.

The 800 level serves as a psychological cushion. The S&P futures are currently trading at 812.00.