All of the agricultural ETFs have also begun showing relative weakness and may drop even more if the rate cuts stop.

The tug-of-war between the bulls and bears is about to get more interesting! Stocks are likely to remain in a tight holding pattern ahead of Wednesday's announcement by the Federal Open Market Committee (FOMC), but expect high volatility on Wednesday afternoon.

Former market-leading sectors such as basic materials, oil, natural gas, and farming/fertilizers all pulled back last week. If those sectors don't immediately recover this week, the lack of clear sector leadership will undoubtedly weigh on the broad market.

Technically, both the S&P 500 and Nasdaq Composite registered another bullish "accumulation day" Thursday. However, a closer look "under the hood" reveals trading actually picked up the pace during the late day bearish reversal. This points to stealth institutional selling into strength.

Though the Nasdaq settled in the upper quarter of its intraday range, the S&P 500 and Dow Jones Industrials showed bearish divergence by closing just below the middle of their trading ranges.

Deron Wagner thinks it seems too obvious for the intermediate-term rally to end cleanly and precisely at resistance of the February highs in the S&P and Nasdaq. He believes a more likely scenario is for the major indices to make another leg up and test resistance of their six-month downtrend lines.

Until the market proves otherwise, Deron Wagner must assume the already established downtrend will remain intact.

Deron Wagner notes that traders must be cognizant of a more substantial resistance level the major indices are approaching: the weekly downtrend lines from their October 2007 highs.

In the coming days, Deron Wagner will be watching for the tell-tale signs of institutional accumulation in the tech arena.

The market is presenting us with a tradeable bear market rally, and Deron Wagner suggests taking advantage of the strength while it lasts.