Will the U.S. get downgraded and where is the stock market headed?

Today was a reminder that there is no hiding from these debt issues.  I talked with a Bond trader today after the close and his first words to me were "we are going to get downgraded".  Is he right?  I have no clue but the market tells me that traders are betting on it.  Where is good old Bernanke?  The fact is the Government is out of bullets and traders are betting that we are heading for a double dip recession.

I would bet that one of the major business news networks has either Nouriel Roubini or Meredith Whitney on tomorrow to talk about this.  These two have been saying this for months and they have been right. I love people that have guts to tell us what we don't want to hear (right or wrong).

The question going forward is where is the stock market headed?

My answer is not what the bulls want to hear.  Today I wrote in my monthly newsletter about whether or not we are going lower, higher or range bound for the rest of the year.  Just after watching the stock market close today I can tell you that we are headed lower.  1255 was support for me in the S&P and we closed below that today.  I now think that we are headed to 1211.  1255 is my pivot.  If we get back above it and hold we could trade back up to 1300 (where I would sell'em again).

Tomorrow is going to be an interesting day because all hell could break loose.  The market is in panic mode and there is no where to hide except Gold.  Keep it tight and hold on because  the party could just be starting.  

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