If you are bearish, you have company – lots of it.

At the 1:46 mark of this video, you can see Jim Cramer trying to knock the market down when he says:

“I’m predicting mass panic tomorrow morning.”

That was while the market was open. Cramer was trying to cover his motives by pretending to be mocking weak-kneed bulls. But that was obviously a thin veneer over a blatant attempt at market manipulation. Can this be legal?

CNBC also published a story titled: “SEC on Attack, Vows More Action on Crisis.”

Note to SEC: While you are “on the attack”, isn’t it time for a anther look at this guy? Is it really a good idea to have the top financial network inciting panic?

The intra-day low on Wednesday came at 10am when the horrific new-homes sales report was released. You would think that would have been a sell signal, but the market rallied for the rest of the day – including the home-builders; the XHB was up 3.15% on the day.

That, of course, was a classic example of the trading maxim: “how the market reacts to news is more important than the news itself.” When the market shrugs-off bad news, then you know it is in rally mode.

So, now we want to know if the market can keep it up as the week ends with a lot of economic data. The market plunged after last Thursday’s unemployment report, so that will be the first test this morning.

On September 1, 2009, I posted this chart showing the giant inverse head-and-shoulders reversal pattern on the IWM daily chart (click to enlarge):

Then, on September 17, 2009, I posted an update showing the pattern’s target and overhead gaps:

Here is what it looks like now:

Not only did IWM top-out just above the projection of the pattern, but the neckline has served as support for over a year. Not bad, huh?

But on Tuesday, IWM pierced the neckline, though it was able to bounce back above before the close. Will the IWM be able to rally off of this line like it has done several times over the past year? The market is pretty oversold now, so we should get some sort of bounce soon, but how high will it be?

Another potential bullish sign was that the IWM was able to briefly rally up into positive territory around 11:45am on Tuesday. It wasn’t able to close up there of course, but that type of surprising move is what I call a “shot across the bow.” It happens during the bottoming, and topping processes. Initially, it looks like a defeat, but later proves to have shown that the losing team was getting spunky.

I’ve been busy writing code for DailyJobsUpdate.com, but over the past several days, I see the SPX attempting to form a bullish falling-wedge pattern. Will it produce a reversal, or will the market go down Hindenburg-style?