Hey its Pikertrader, first guest post but have always commented on the site especially back in the day when Tim hid his love for AJC. I remain cautiously bearish right now and have very tight stops for a few reason.
Day ja vue: Remember last July, when everyone was discussing the same head and shoulders pattern as they are now. This famous pattern's neckline broke and all the bears cheered only to be beaten like a baby seal for the next 6 months as the market rallied on "green shoots", amazing bank earnings and just a economy that grew on good ole fashion productivity! (Bull$@#)
Second caution sign comes from the daily chart. MACD is showing some signs of bullish divergence, as it fails to make new lows with SPX.
So remain cautious because if this is another Head and Shoulders, fake you out and beat the bears pattern, it won't be fun being on the short side. But divergences and past patterns aren't crystal balls so anything could happen, like another 5%- 7% decline to the 980-950 level.
For more daily charts and updates after you have read all of Tim's stuff go www.pikertrader.com