Stock index futures ended the day lower after bids were pulled late in the session allowing the market to plunge to new session lows. Although the December E-mini S&P 500 made a new high for year, the inability of the Dow and NASDAQ futures to follow-through to the upside created a bearish divergence that helped weaken the market throughout the day.

At the time the S&P was making its high, the Dollar was weakening but not making new lows. This made traders nervous since the driving force behind the 9 month rally in the equity markets has been the weaker Dollar. Many traders got trapped on the long side of the market this morning following a gap higher opening and a friendly initial claims report. The gap opening was triggered by aggressive Asian buying following yesterday’s late session report that Bank of America was going to pay back its TARP money.

Although the main trend is still up in the equities and some will say it was position evening ahead of tomorrow’s U.S. Non-Farm Payrolls Report, today’s failure and subsequent break looks a little more bearish. The outside move down so close to a major 50% retracement level in the S&P at 1122.00 makes one wonder if this was the final leg up. A trade through 1077.75 will officially turn the main trend down on the daily chart, but a trade through today’s low at 1097.50 will confirm the reversal top and give traders the first clue that a top has been formed.