My apologies for not having time for a full post, I have been remaining incredibly busy these days, but I suppose the title of the post says it all. The market had every reason, in the form of the economic data that came out this morning, to fall further but it didn't. The McClellan Oscillator is banging on the doors of oversold levels though its not quite there yet. All this gives me reason to believe that we could see a short term bounce in the near future. The game play here should be to start taking profits on existing shorting positions and if you like living life in the fast lane, to initiate small long positions here. Why small positions? Because I sincerely believe calling tops and bottoms is a fool's game. Better to start with small positions here and add if you are right or get out with small losses if one is wrong.
I will leave you readers with a chart of the S&P. If we do get the bounce here, I see 1040 and 1060 as the next major resistance levels. Keep an eye out on the volume if the bounce occurs. Weak volume would indicate that one should sell into strength here. Also, I see a lot of talk about the upcoming death cross signal i.e. MA(50) falling below the MA(200) level. But as everybody is expecting the market to fall at the death cross, I wouldn't be surprised, or rather, I expect the market to rise at this signal. Makes sense?!
Take care and good luck!