Although the stock market closed higher today, we have experienced four weeks in a row of losses for stocks. However, we are stuck in a range between 1,300 and 1,350 on the S&P 500. It is concerning to me that the market does not seem to be able to decide which direction to go. I see the bias leaning to the downside, and still feel that valuations are quite rich. If we break through 1,300, we should push hard and quickly to 1,250, which is the next support level. Pending home sales dropped by 11.6% (April) from March, and 26.5% compared to April of 2010. That is plain ugly. We have received somewhat mixed real estate data, although for the most part, the numbers have been negative. I think we could see another 15% to 20% of downside before we reach bottom, and don’t expect to see prices bottom until late 2012 at the earliest. As for stocks, I am cautious, and would feel much more motivated to risk new money below 1,250 on the S&P 500.