I believe the direction of the market is down from here in the long term but could have some months of rally left. Technical analyst and associate Roger Wiegand, tracks more short and intermediate term indicators that can help determine trading strategies. In the following article Roger gives data that looks to a weak market.

“I think the big question for most market participants is whether or not the market is putting in a medium-term bottom. The evidence is truly mixed, and I can make a case for either side of the argument; however, we have sell signals on both the daily and weekly charts, so, for now I think I will focus on the evidence supporting a further decline. On the chart below you can see that last week there was a sharp two-day decline that found support on the 200-EMA, and formed an inverted flag pole. This week, prices trended upward in a narrow range, forming a flag at the end of the flag pole. A flag formation pointing upward is bullish. Pointing downward (inverted), it’s bearish. …Implications are short-term, with a possible downside to area of 1020.” -Carl Swenlin Decision Point

“While anything can happen in trading, we think after the full five wave selling event shown on this chart that we can see new buying taking the S&P 500 Index back to 1100+ resistance forming a new head and shoulders top prior to the larger selling event we have forecast for the spring of 2010.”

“We are expecting a weak stock rally with potential to form a double top at 1150. We give this one chance out of three. More likely, the price will peak out near 1100 producing the head and shoulders pattern most traders know-this means big selling ahead. Double tops are sellers too but a head and shoulders spread over months since last October signals the Big One…The Big Sell.”