Even though CPI was above consensus, and even though consumer sentiment fell yet again, the market is rallying, up about 150 points on the Dow as of this writing.

Looking at the intraday graphs, you can see this rally is still within the context of a downswing.

In addition, the VIX, which fell sharply from mid-March to mid-May, has now hammered out a nice saucer pattern, implying an imminent upward move.

The market blasted higher today, rebounding from yesterday's fall, only to see the entire gain erased half an hour before the close. Regretably, the bulls got a little strength back, but the day's gain was a fraction of what it had been up earlier. As has been so often the case lately, I started the day way in the red and, having done absolutely done, wound up nicely in the green.

Yahoo has long been a puzzle to me. I've been using computers since 1980, online computers since 1982, and the Internet since 1994. In all that time, I've used Yahoo approximately never. I love Yahoo Messenger, but that's about it. Anyway, I guess a lot of people do actually use this thing (in spite of so many better choices), but the MSFT/YHOO merger was officially scuttled today. It's remarkable to see how, nearly a decade after the stock peaked, it's still down almost 80%. I'm using an arithmetic scale here to better illustrate the drama.

I noticed the $UTIL is starting to form what would be a sensational head and shoulders pattern. It might take months to complete, but a collapse here would align with much higher future interest rates.

Gold continues to weaken. $1000 gold was such a huge deal in March, but that seems like eons ago now.

I'm loathe to cast a bullish eye on a stock, but this battered beast looks like it has a chance, provided it stays above the line you see here.

Oh, and poor AMR. This graph shows 40 years of trading. Notice how the low in 1974 matched the post-9/11 low. Can you believe that in the span of 5 years this thing has gone from a lifetime low to a lifetime high and is on its way to another lifetime low? Astonishing.

Another "poor old" stock – Sun. This makes Yahoo look like a blue chip performer. This stock is down 96% from its peak. Poor Sun. Most of the Internet runs off Java, its creation, but it seems like such a loser outfit.

I've been wanting to short CNH for a while, but I can't find the stock. Anyway, this fantastic head and shoulders complete today.

Here's a fine example of a failed bullish breakout. It blasted from $63 to $84, and now it's back down to $51. Ouch.

Here's another beauty I just saw – ICE. It can be hard to short stuff like this, since it's down so much already, but this is a massive pattern.

Here's another H&S in the making.

As for LEH, I have traded this in ages. Unless this is headed for bankruptcy, I have trouble believing it is going to go much farther down than this. But BSC fell to pieces in no time, didn't it?

This has been a terrific week so far. I'm holding out hope for a good Friday to really round things out. See you on the other side of the trading day!