Stocks made another impressive move higher on Thursday. I think we’re all enjoying seeing a little upside for stock prices. There is a light at the end of the tunnel. But I don’t want us to lose sight of the near certainty that at least one of the lights we’ll see in the darkness will be the proverbial oncoming train. 

Market bottoms can be difficult events to get a handle on. Bullish and bearish sentiment is in equilibrium. As individual investors, we might feel that things aren’t getting any worse, but they aren’t getting better, either. Sell-offs appear to clearly be buying opportunities (like when the Dow dropped to 6,440), but any upside is immediately suspect because there’s no real improvement to the fundamental picture.

Stocks gave up their early gains yesterday. As I’ve been saying, I don’t think we see much upside until earnings season is closer to the finish line. It looks as though a vote on the stimulus bill may not come until next week. That could give us a double-whammy of upside catalysts.

The Dow Industrials is below support at 8,000. But the S&P 500 is above its support at 825. It seems highly likely that the S&P 500 will test those levels today. It’s important to understand that support is often expressed as a range rather than a specific number. Just because an index or stock moves below support doesn’t mean it’s crashing.

That was one of the best Super Bowl games we’ve seen in a long time. There were some costly penalties on both sides of the ball, but in the end, both teams made some phenomenal plays. Congratulations go to the Steelers for their sixth championship ring. And equal congratulations go to the Arizona Cardinals for turning their first ever Super Bowl appearance into a great game.

*****There are rumblings that Senate Republicans may not pass Obama’s massive stimulus bill. This may be politicking, as the GOP clearly wants to show that it has some teeth. But there’s a lot of pretty ridiculous spending included, too. $300 million for sexually transmitted diseases jumps to mind. I hope the GOP is successful in stripping out the fat.

Caterpillar (NYSE:CAT) missed earnings expectations and announced 5,000 job cuts. Home Depot (NYSE:HD) is cutting 7,000 jobs. And Sprint (NYSE:S) plans to ax 8,000 employees. And yet stocks are up today due to a surprise jump in existing home sales for December.

Once again, the Dow Industrials has confirmed that there is support around the 8,000 level. Yesterday’s bounce marked the 12^th time the Dow has bounced as it approached 8,000 since October. Only once has it failed to do so. That was November 20, when it set the low for this bear market at 7,464.