Last week was a battle, make no mistake. The very reasons for the bears to be bearish were unearthed. Housing remains a major problem. Sales of new and existing homes are down. Home prices are still falling. Mortgage applications slipped. Meanwhile, 11.3 million mortgages are underwater. Jobs may not be coming back just yet. Weekly claims shot back up near 500,000. Jobs will be the main focus this week. The Dollar Index is holding near 80, as the EU struggles to find a solution to Greece’s problems. Heavy treasury auctions are edging rates higher, and the Fed has taken the first baby step toward an exit strategy. Meanwhile, the economy isn’t doing all that well. The bulls have but one hat to hang onto. That is corporate profits. The data we’ve seen shows inventories still very tight. New orders are still outpacing production. This should lead to strong profit margins, even on moderate gross sales. For the first quarter, this looms as a threat to the bears. We all know that comparisons to the first quarter to 2009 will be a piece of cake. By the time we get to late March, the attention will shift to earnings and will favor the bulls. However, this week should focus on jobs, and that could provide the catalyst for a quick test of the recent low. The good news is that the technicals heading into this test have been relatively positive. Volume is light. Breadth has been good. Leadership has been excellent. If Tech and Financials fail here, look for the test to follow quickly on their heels.