In the fashion and apparel categories, expect to see evening wear and diamonds driving sales. In addition, tailored denim products - across men's, women's and children's wear - will be a hot item. Women's boots also will help drive sales this holiday season, with a focus on three-quarter length boots rather than knee length.

Interestingly, fashion will be getting more high tech this season.

"Technology is having an impact on fashion," said Dan Butler, VP of retail operations and merchandising at the National Retail Federation. "Whether its sweaters or vests designed to hold handheld accessories and iPods, or handbags, which are designed for these devices, we are going to see a lot more of these kinds of products this season."

IPod and cell phone accessories will be popular tickets this year, including a new breed of accessories designed to hold these items in the home. Expect to see more widescreen televisions under the tree this year, along with widescreen computer monitors, as the prices of these products have come down.