[Tommy]

First off, be careful. Loss of power is one thing. Sparking sounds mean an electrical fire is a possibility. ... If you have a friend who can help, losen the positve cable at the battery so your friend can pull it off in a moment if needed. Then start wiggling cables and checking connections. As said above, it is most likely a bad ground or perhaps a loose connection to your ignition system. But it is also possible for it to be a short circuit due to worn insulation or the like. ... As the red light worked but the engine and horn didn't, I'd focus on wires that are common to the ignition and horn.