You know, I rarely watch CNBC. I mean, let's be honest, probably the only thing that group is good for is, perhaps for being the preeminent contrary indicator, if you will, when it comes to calling significant turns in the markets.

But for some reason, I decided to turn on the channel a few times today, for several minutes on each occasion, just to get a feel of what the sentiment was like in the, oh let's call it the "fundamentals" crowd... Almost on every occasion, I heard what can only be described as full on cheerleading for a bounce. Several times in the last hour or two, they repeated a seemingly nonsensical claim that went along the lines of "oh, look, the Dow has bounced 20/30/40 points, off its intraday lows (when the index was down 125 points, on top of yesterday's 225-pt drop) and, since every correction over the past several months has ended fairly quickly, this one must be over - given that the indices have been able to hold the day's lows - now."

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The major indices have recovered quite nicely over the past few weeks, and it looks like the bulls may not be spent yet... Several of the majors are showing bull flags or bull pennants that call for some more upside in the week or two to follow.

S&P-500

S&P-500 Large Caps: Bull Pennant

SPX broke out of a bull pennant last week. The run up into the pattern measured 40 points. Therefore, given that the breakout level was 1125, a target of 1165 is derived from the pattern, if the pennant is legitimate.

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The holiday season is in full swing and, although it's business as usual in the Members' Area of our site, we've gotten caught up in the festivities and slacked off a bit on the blog. We'll be back to normal programming - providing a handful of articles every week - on the blog soon after the New Year begins. In the meantime, here's a quick update on the state of the markets, as covered in last night's commentary that was provided to members...

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The hourly chart of the S&P-500 moved to a slightly higher high yesterday but, as you'll see in the weekly chart (second chart below), it hit a significant level of potential resistance at the close yesterday.

The index has lost ground so far today and the hourly charts are now showing more pressing negative divergences than they were earlier in the week...

S&P-500 hourly chart, showing negative divergence on MACD

As the chart shows, the negative divergence on RSI, earlier this week, lead to a quick 30-pt drop on the index. The lower band on the hourly chart quickly came to the rescue, however, and prices rallied back towards the earlier highs.

Those highs were surpassed yesterday. The new highs on the index were not, however, accompanied by new highs on hourly MACD and, as such, we now have a glaring negative divergence on MACD; infact, if you look closely, you'll see that there are two negative divergences on MACD; the most recent one resides within a larger one.

If the potential sell signal confirms itself, we'll be looking for a move to the minor support area at 752-767, at the very least.

While the negative divergences on the hourly chart are short-term sell signals, at best, the reaction to the 20-week moving average, as seen on the weekly chart (below), is the big "Kahuna", as it were...

S&P-500 Weekly chart, showing potential resistance from 20-week Moving Average

Notice that yesterday's highs (832) coincide with the 20-week Moving Average. The index was not been able to move above its 20wMA since June of last year. If/when that level is broken (and stayed above), an intermediate/major buy confirmation signal will have been generated.

Until/unless that happens, traders will want to be on high-alert to the possibility of an abrupt bearish reversal.