I have drawn Fibonacci retracements on the $SPX from the peak of the post-Obama election euphoria down to the depths of last week's despair. The retracement levels are pretty interesting; I've tinted some key ones here.
Friday's late-day rise was very sharp, but if can't manage our way past the retracement at $803.91, that's simply pathetic. Pushing up to $842.82 level would be pretty exciting; I would use that opportunity to exit my bullish positions (SSO, QLD, DBA, and a variety of small longs) and go short the ES. The highest I can fathom the S&P going in the relatively short-term is the $905.71 level. If we cut above that, it's pretty evident that the bottom is in place and we're in store for a much more substantial rally than we've seen in many months.
