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Technically the Santa Claus rally, like USC's football team, broke its string of successive (8 of 8) years of rallying higher in '05 - the last 4 days and first 2 of the next year. In the spirit of the record, however, it was only 3 points lower ( 10,880 vs. the 10,883 close Dec.23), the Nasdaq and S&P 500 did close higher, and that was one heck of a rally, albeit a few days late, to a new nearly 5 year highs! Alas, the bigger perfect record of never a down 5th year over 13 decades bit the dust.
Thanks to nanotechnology and Globalization, a new polling parameter is emerging, as reported by James Surowiecki in his best-seller - The Wisdom Of Crowds. Pooh-poohing the findings of such notables as LeBon (The Crowd), Mackay (...Madness of Crowds), and even Baruch, Thoreau, and Nietsche, he posits convincingly that vast numbers of diverse opinions bring about best results, citing the Iowa Election Market, Britain's Tradesports.com, "Millionaire's" Lifeline, and the Las Vegas oddsmakers who put money where their votes are. We're even starting to see signs in Bush's meeting with prior Sec'ys of Defense (not all "Yes men"), and IBM's polling of 320,000 employes in 175 countries by e-mail for antithetical opinions and suggestions.
This week's Sentiment numbers are also poles apart suggesting, at best, volatility: some Bearish signals ameliorated - ISEE call/put ratio, McClellan Oscillator changing direction from below the zero line, Burke's I.I spread narrowing 8 points, and the Advance/Declines and New Highs/Lows exceptionally strong (nearly 8:1). Most Bullish was the inverted AAII survey with only 29% Bulls and 40% Bears!
However, there are also several toppy Indicators in the mix: Although the McClellan Oscillator changed to positive, it also shot up to its Resistance level of @50, as did the Bullish per cent at 72. There may be some Resistance to breaking through the 11,000 DJIA level this week. Finally, the Nasdaq to NYSE Volume hit a recent, speculative high at 132, and the Public to Specialist shorting fell off appreciably - 5.66 down to 4.37, over 20%.

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