Fed Decision Gets Some Attention

Today is a rate decision day for the Fed. The market is only paying a modest amount of attention to the FOMC meeting. Simply put, traders don't expect to hear anything, and they don't want to hear anything. The rest of the market is relatively quiet, with IBM looking (still window shopping?) to buy Sun Microsystems (JAVA), which is catching some chatter. In addition, ADBE and GIS reported earnings, but neither will move the overall market.

Pre-market futures are down slightly, but the market is pausing to contemplate more than anything. Traders may try to build off yesterday's gains eventually, especially if the are convinced the Fed isn't going to break anything today.

From about 762 and up yesterday was somewhat unusual price action on the SPX. The market blew off the Shooting Star, which means the Shorts and Bargain Bulls are still fixated on and anxious about stocks. This is an extreme swing, which means that it's possible that traders reach as far as the 800 area on the current upswing.

Here is a chart of the SPX:
(click on image to enlarge)

The SPX is prodding the current short-term resistance in the 770 - 780 area. The next intra-day move could take the market as far as 785 - 790, and as I mentioned above, if traders continue to be in an extreme mood, then 800 is not out of the question on another move after that. The latter stages of the day yesterday, and the latter stages of this upswing are extreme moves, but not unprecedented. Fund managers are feeling warm and fuzzy, and completely twitterpated with the stock market again. It's as I stated before, we experienced a seed change durning the News Bogey Gauntlet, and the Fundies are buying it hook, line, and sinker. And when traders get this way, I've learned to just go along with it, so as I stated yesterday, I'm not interested in loading up on any puts. The market will have to prove a roll-over for me to buy puts, and even then, as I have said for several days, any pullback will probably only retrace a portion of this upswing, and the SPX is probably headed for a higher low and trend change in the next week or so.

Earnings and Economic Reports Take Over the Spa

AA and RTP both warned about current conditions/earnings and both stocks are down pre-market. Metal stocks will probably see some early pressure this morning. In addition, GS just reported earnings and the initial reaction is a slight drop, but there is still a lot of time before the open for traders to sift through data.

This morning also has several economic reports. Housing Starts and Building Permits, and PPI. The first stage of the reports just hit the market with a slightly positive reaction. But just as it's early with the GS earnings, it's also early with the economic reports. The market appears to be modestly excited about a much better than expected 583k vs. 500k Housing Starts. I will check back later and decipher the news and the reaction.

The SPX threw a Shooting Star yesterday, which has a probability of rolling over into a consolidation day today. Unless the news this morning is overwhelmingly positive, I would expect an initial consolidation to drop down to the 742 area intra-day, and if that level is breached then the next intra-day wiggle point is probably at 735. A move above 760 is a mild warning for exiting puts, and a move above yesterday's high is a drop dead line for puts.

9:00 am MT: Intra-day Update: The market has had every chance to rally hard off the much better than expected housing numbers, but traders are stuck in neutral. The counter to the stronger than expected economic data is the string of earnings warnings in the Metals (AA, RTP, and NUE all warned to the downside and are selling this morning). The market is fussing along the short-term resistance area established with yesterday's Shooting Star. I warned yesterday that traders would make more of a fussy short term top rather than a smooth rollover, which is still playing out.

Here is a current daily chart of the SPX for reference on the Shooting Star and short term resistance:
(click on image to enlarge)

Here is a current 60m chart of the SPX showing a potential intra-day bounce that might lead to a test of the 765 - 770 area:
(click on image to enlarge)

Think of the short term top as a three stage warning. The first warning that the upswing might be over was the Shooting Star right at the resistance cluster yesterday. The second warning will come if the SPX (market) makes an equal or lower high on the 30m - 60m charts and breaks down. The third warning and final confirmation would be a close below the low of the previous day.

The UVOL-DVOL is diverging from price and advancers right now, which raises the probability that the SPX will not make a higher high on the 60m charts. There are a number of stocks setting up for puts (although nothing has confirmed yet) like FPL, EXC, BNI, AMGN, FDX, the Q's and so on. Remember, again, and I keep warning of this, look for a shorter 2-3 day type of pullback and not a long 4-7 day pullback to new lows. The puts will likely be quick and to the point this week. Traders are still breathless over their blind date with the Banks and Government. Whether or not reality brings something new into focus only time will tell.....

9:13 am MT: Intra-day Update: The market continues to grind a bit, but the way price action is fussing, I'm not sure an intra-day bounce will be able to make it back to 770, but as always, we shall see.....

11:35 pm MT: Intra-day Update: There isn't much to say other than the market keeps pushing, and the reluctant topping action is still playing out. Traders are still very much in love, so there's no sense in fighting it until it's over and the market confirms a short term top. It's a bit risky to try and squeeze out some more call trades this far into a sharp upswing, so I'm basically sitting on my hands and waiting this out.

The Spa is Still Open but the Masseuse is Getting Tired

Pre-market futures are up strongly on the combination of Ben Bernanke's comments that the recession "will end soon" and Barclays Bank of the U.K. echoing the U.S. banks with a "we had a strong start to 2009 too" statement. The news chatter is drowning out the report of the worst contraction in the N.Y. Manufacturing Index ever as sales and inventories dropped the index to -38.2 vs. the -32.0 expected. The bad N.Y. number will put the Industrial Production/Capacity Utilization report, due out 15m before the open, at more risk for a downside surprise.

Barring a horrific Industrial Production/Capacity Utilization report, traders have definitely switched gears mentally as of the News Bogey Gauntlet started last Tuesday with Citigroup. The run of Banks/Financials news went like this: C Tuesday, JPM Wednesday, Congress Thursday, BAC Friday, Barclays and the Government Monday. As I stated in the comments for Friday, the market has gone through a "seed change" again. Traders now are viewing the banks as "innocent until proven guilty" whereas they viewed the fundamentals in banks and financials as "guilty until proven innocent" the week before. For now, traders are drinking the Banks/Government Kool-Aid.

Here is a chart of the SPX:
(click on image to enlarge)

There is a hard resistance right about 770, which is almost exactly where the market is set to gap this morning (again, barring a catastrophic Industrial Production/Capacity Utilizatio report). If the economic report is wonderful, then the market may overshoot to the top end of the resistance zone. Either way, watch carefully for resistance in the 770 - 780 area this morning. If the economic report comes out fairly benign, then it won't surprise me to see a gap, pop, and fade again. The Bulls may decide to hang around today because they want to see if GS can give the Financial News Gauntlet another boost tomorrow morning with their earnings report. Watch any call trades this morning because the probability is running pretty high that the market is in the last stages of this upswing, so keeps stops tight and stay nimble.

7:23 am MT: Pre-Market Update: The Industrial Production number missed -1.4% vs. -1.3% expected. The Capacity Utilization number was roughly in-line at 70.9% vs. 71.0% expected, however the 70.9% is the worst number on record, which is dousing the Bulls a little. Pre-market futures dropped a little bit on the report, but not enough to change the gap, pop, and fade I'm expecting. We may see a gap and wiggle first though, similar to Friday. Again, use the surge this morning to exit any remaining calls and then watch price action carefully to see if the upswing has another leg. I still speculate the market is coming to the tail end of this upswing.

9:05 am MT: Intra-day Update: The gap and pop are probably mostly done.....The Naz is already rolling over. Market internals are still showing the possibility of one more push on the SPX, but any leg up is probably going to gas out fairly quickly and not carry into the end of the day. The Ascending Triangle on the 5m charts of the SPX is trying to break a little to the upside, but it may not go more than one leg and then be done. We shall see.....

9:35 am MT: Intra-day Update: There's the push the internals were forecasting. The SPX hit 770 right on the nose. We'll see if this is the end of the upswing, or at least the area of the end of the upswing.

9:50 am MT: Intra-day Update: One note here about any rollover. Don't expect a sharp sell-off. The seed change in the market means that the swing could battle around a top for awhile before it consolidates. Rather than a smooth roll-down, look for some battling and fussing as the Shorts cover a bit, even on pullbacks. I may look at a few puts today, but I'm not going to be very aggressive until it looks like the market is really ready to roll back down. And even then, remember, the roll-down may stop at a higher low, so as always, stay nimble. The first stage of a topping area on the upswing may be signaled by a roll-over in the $UVOL-$DVOL, so right now is a good time to pay attention to that internal.

10:45 am MT: Intra-day Update: The UVOL-DVOL is still ramping, which is an indication of what I warned an hour ago - that the market won't just hit the spot and roll over hard. There is still too much freneticism, even in the top end of the swing, and traders continue to pour the money (volume) into stocks. It's even possible that the SPX overshoots to 780 with this type of frantic buying. So don't get aggressive with the puts just yet, I keep warning to watch the UVOL-DVOL, and that's been dead on accurate so far today.

1:15 pm MT: Intra-day Update: Did you see the 3 (Red) Crows on the UVOL-DVOL 30m ago? If you did, then you saw what I was pointing you towards all day long. The down volume just carried through again as I type this, so a Shooting Star is starting to form on the daily price chart of the SPX. Now, this topping area may still fuss around a bit because of the freneticism on the part of traders, but the market is less likely to make any new highs today.

Oh, and I did nibble on some Q's (paper) puts when I saw it form.

1:22 pm MT: Intra-day Update: Look at the down volume now, the monkey rang the bell.....

1:37 pm MT: Intra-day Update: There are lots of stocks to choose puts from, but be aware that just because there is an abundance doesn't mean you have to load up right before the close. You may only want to nibble a bit and then see if the roll-over continues tomorrow, at which point you can get some more short swing puts. Also remember the consolidation may not go all the way back down, in fact, I speculate that it may only retrace 50% of the upswing at the most.

2:20 pm MT: Market Wrap: This is a quick wrap. The SPX threw a Shooting Star right into the middle of the resistance zone I drew out for you pre-market. I locked some of my Q's puts for a nice 8.5% gain in a few hours. I'll be looking at puts again tomorrow, and just like today, I will be looking intra-day.

Don't lose sight of the fact that traders are feeling the flutters again, just like their first date long ago, they are nervous and excited about their one true love all over.....stocks look good again? It's probably the epinephrine, but hey, love is love, and the Bulls are in love again.....the best case scenario is this could turn out to be a long term marriage.....the worst case scenario is the blind date is in violation of probation.....

Financial Massaging Continues

Pre-market futures are up this morning after "encouraging" comments from Bank of America's CEO Ken Lewis. Lewis said that BAC was profitable in January and February. Last night in VC I talked about the "coincidence" (wink wink) that Citigroup announced profitability in January/February on Tuesday, which led to a big up day.....then Jamie Dimon, CEO of JPM announced virtually the same thing on Wednesday, which again led to another up day in the market.....then an "accounting board" told "Congress" that it would recommend an easing in the way banks "account for bad assets" on Thursday (which, by the way, is about as opposite a policy as you can get from what most of the politicians "ran on" in order to get voted in), which led to another big up day in the market.....And then lo and behold, out of nowhere, who could have seen this news bogey coming, it's a total shock, we never wudda known?!!?.....Ken Lewis says BAC had it's most profitable two-month stretch since 2007.....

Well, those of you who were in VC last night were actually expecting this today. It wasn't a matter of if the government/banks wanted to get into the weekend with a last positive news bogey, it was a matter of when they would bogart the market, and how they were going to do it.....

The only problem with the way Lewis did this was that it was too early in the day (pre-market) and now the market is at risk for a gap and fade (Lewis just doesn't know how to play this game right, he needs to take lessons from Dimon who actually waits for the market to be open for a few hours and then gets himself on CNBC to really nail the news bogey). I suspect that if the market starts fading too much after the gap (profit-taking on the biggest four-day upswing since November) that the government/banks will roll their eyes and think "Lewis you #*%@#*, you're supposed to wait until after the market is open before you bogart it, then it runs all the way into the close you *@^##<*#@* amateur!!!"....and then we'll get some kind of "insurance" news bogey in order to close the deal. Last night in VC I talked about the four-day rhythm that I was expecting, which was Flash Bang, Flash Bang. In other words, I was looking for another candle similar to Wednesday, but just a little stronger (close to what the March 4 candle on the SPX looks like). So I was looking for a move up to 770 - 775 on the SPX (market) and then some Friday afternoon profit-taking, and then the last of the "messy pants" Shorts to cover a bit and run the close back up to around 760, which would create a positive day with a bit of an upper shadow. Now, thanks to premature news bogarting, it looks like a gap, pop, and fade, which would form a candle more similar to Wednesday's Spinning Top. I still speculate that the government/banks will try to prop things into the weekend after this whole parade of "coincidental" news Tueday-Friday, they have worked too hard to allow a big fade into the weekend, which would put a damper on their Plunge Prevention Program campaign. So I still speculate that the four-day rhythm will be Flash Bang, Flash Bang, I just think it might be a little bit more of a small body Candle because of the gap this morning (although the gap won't show on the SPX charts anyway, so it could show a larger real body on the candle - the thing is that you have to account for the gap, even if it doesn't show on the SPX - use the SPY to see how the gap forms).

Here is a chart of the SPX:
(click on image to enlarge)

The push this morning may go as far as the 760 - 765 area, and the high of the day (later on) might reach into the 770's, but I would be cautious for profit-taking both after the gap this morning and in the last 90m - 120m of the day. I still think the Shorts will keep things from selling off too much into the close, especially with all the "good news" coming from the banks, it will have them too concerned about being short over the weekend. So as always, we'll see what the new day brings. The price action today may not be as easy to play as yesterday, and it may be a bit more volatile than the past three days, but it may offer some opportunities, and it will at least be fun to watch the gyrations of the government and banks.....or the government banks.....or.....whatever.....

10:05 pm MT: Intra-day Update: The first stage of the type of day I was anticipating is in the books. I was looking for a gap, pop, and fade early in the day, which is exactly what we got. Now it's a matter of watching to see if we get another round of short-covering that runs the market back up again before another round of profit-taking hits.....

11:13 pm MT: Intra-day Update: The second stage of the type of day I was anticipating is running right now. The Shorts/Bargain Bulls are pushing the market back towards the highs of the day. We'll see how far stage 2 goes.....

Here is a 10m chart of the SPY showing the gap, pop, and fade in green circle highlights, and then the push back up by the Shorts/Bargain Bulls in a light blue highlight:
(click on image to enlarge)

From here, I expect some more pushing and basing, and then some profit-taking later in the day, followed by a last ditch "messy pants" short-covering into the close. The Hot Potato close will probably leave the Bang Day today (Flash Bang, Flash Bang) with a smallish real body. We shall see what happens next.....

12:17 pm MT: Intra-day Update: Here is another round of profit-taking starting inside the 2 hours to close mark. We'll see if this is a mini-round or if it pushes back towards the lows of the day. This is likely the third stage I was looking for, so we shall see.....

1:37 pm MT: Intra-day Update: This is probably a bigger round of profit-taking just getting ready to start, at least for a few minutes. We'll see if the Shorts/Bargain Bulls can hold the profit-taking from getting too large. If the market drops a little here and then pops again before the close, and basically finishes similar to where it's at now, then the Bang candle will be almost identical to what I described before the open.

2:15: pm MT: Market Wrap: This is a quick wrap. The first 2/3 of the day went exactly as I speculated, a gap, pop, and fade followed by some short-covering/bargain buying. The last 1/3 of the day was a little variant from what I was looking for, but it was close enough, and the day finished just as I speculated. Before the open I said that I would be looking for a Bang candle that was "similar to Wednesday." If you look at today's range and candle, it's very similar to Wednesday in price action. So the Flash Bang, Flash Bang that I warned was likely to play out - did play out almost exactly as outlined. The only thing slightly unusual was the last 1/3 of the day. I was expecting a bit of a hot potato in a rolling price action where the profit-takers rolled things down for 30m - 60m, and the shorts/bargain buyers rolled things back up for 30m - 60m. Instead, their activity was a little more compressed, with the downswings lasting 10m - 15m and the upswings lasting about 60m. What it tells me is that there were still enough Fundies hanging around and getting a little more intense about the end of the day/week/upswing then I would have expected. Then again, a lot of these Fundies don't know how to trade anyway, so I suppose their fixation on the last thrust of the upswing shouldn't have been all that surprising.....

The net net on the day was that price action did follow the rhythm I was looking for, a Flash Bang, Flash Bang. I speculate that early next week we will see some consolidation off this move, which really isn't all that much of a stretch to predict.....I would imagine that a lot of us are thinking the same thing about now.....

Market Tips to the Bulls

The market paused yesterday to catch its breath after such a large move the day before. Today, the market is in stasis, wondering which way things will tip. The economic data this morning was mixed, with Weekly Jobless Claims coming in slightly worse than expected, and Retail Sales coming in slightly better than expected. Because the data came in near enough to expectations, pre-market futures are relatively flat.

The market could tip either way today. Since the range yesterday was fairly narrow, a move outside the range would create a probability for the next move.

Here is a chart of the SPX:
(click on image to enlarge)

Here is a chart of the Naz:
(click on image to enlarge)

The index charts look very similar, so I will focus on the SPX. If the SPX drops through 713 then it's probably headed towards 700, with the probability increasing for a return move back to the 670-680 "Fibonacci" zone. If the SPX pops through 732 then it's probably headed towards 750, with the probability increasing for an intermediate term change in the downtrend from bearish to neutral to bullish. If the market pops or drops through yesterday's range and then collapses back into the range after a head fake, then the probability increases that the market will continue to pause, which would actually be more bullish and increase the likelihood of a move up to 750.

Pre-market futures continue to battle around the flat line, so the market may "kick the tires" for awhile before deciding what to do next. Today is really a 50/50 type of day to me, it could go either way. And today has a slightly larger risk of a headfake pop or drop, so a failed signal could be a good signal too. I would be more inclined to play an individual stock move today than the market ETF's. And I would watch things closely and stay nimble. If the market picks up some momentum, then it could run a fourth leg up on the intra-day trend, which would take the SPX to the 745 - 750 area. However, I want to stay right on top of the price action for a while today, it may take a little while to see which way traders want to take things. If nothing forms by mid day, then the market may stay in pause mode for another day.

11:55 am MT: Intra-day Update: The market tipped to the Bulls a few hours ago and now the price action is on its fourth intra-day leg on the 30m charts. Right in this area (740 and up to 750) is the zone you want to start scaling out a little from any calls you placed a within the last 90 minutes or so. This leg on the 30m - 60m charts looks like it will peak out right in the zone I drew for you pre-market.

Here is a 60m chart of the SPX showing the current intra-day upswing:
(click on image to enlarge)

Here is a 30m chart of the SPX showing the fourth leg intra-day upswing. You can see the trajectory and price action is starting to slow:
(click on image to enlarge)

A drop below 730 would be a drop dead for any remaining calls. A run to 750 would probably be the last area to squeeze out any profits on the day.

1:00 pm MT: Intra-day Update: The SPX (market) ran right to about 748 and is starting to consolidate a little. This is getting in to the last area I would expect before the current leg up is done. So this is a good lock and walk spot for the day on any remaining calls.

Technical Bounce Day 2

The bullish momentum from yesterday's big move is set to push a little more out of the gate this morning. Yesterday I speculated the furthest the market would go intra-day was the 725 area, which is still a natural consolidation point if the market moves up right at the open. I speculate that the 725 area will be an intra-day resistance, but the market will eventually push through and continue this technical bounce.

Here is a chart of the SPX:
(click on image to enlarge)

The next intra-day wiggle point will probably be the 730 area. The market was oversold enough that a technical bounce on the daily charts back to the 740 - 750 area in the next couple of days would be reasonable, and overshooting in to the 760-770 area would not be out of the question because of short covering along with bargain buying.

Today, I would prefer the 700 area to hold on any deep pullbacks, and 693 is my drop dead line. If the technical bounce is to carry through with a little momentum, I would really like to see the 705-710 area hold and the market not come all the way back to 700 or lower.

7:58 pm MT: Intra-day Update: The market wiggled for a moment right out of the gate and then ran to the second intra-day resistance level in the 730 area (overshooting a couple of points). It's now at the next pausing point intra day. If the price action gets too frenetic in the next hour then we could have a lengthy mid-day consolidation of the sharp move up.

Financials Bounce the Market

Citigroup announced a profit for the first two months of 2009.....which has the Shorts on the run this morning. Just the short-covering alone today will probably give the market a short term technical bounce.

That is the news.....Citigroup was profitable.....

Now, whether or not C is actually stabilizing, and whether or not the profits are real doesn't matter. What matters is that the Shorts will knee-jerk into covering, and a technical bounce could form starting today. The news might even be enough to pull some Bargain Basement Bulls into the market. So I won't be surprised by a higher volume confirmed bounce type of signal today. For now, it looks like the SPX Fibonacci retracement will hold rather than the lower Dow Fibonacci retracement. The macro fundamentals haven't changed, but just the thought of stability will probably be enough to bottle-rocket the market short term, perhaps for several days or even a few weeks. This market is crispy fried enough right now that a technical bounce just needed a spark in the brush, which it may have gotten this morning.

The key, as has been the norm recently, is how the market handles the first fade period. Traders need to hold the gap or the market is at risk for another Chop Day.

Here is a current chart of the SPX (7:40 am MT):
(click on image to enlarge)

You can see that the 695-700 area is the first test point intra-day. The market gapped and popped to the first resistance zone almost immediately out of the gate. A break above the 700 area clears the way for the technical bounce, but the market has to treat the gap with dignity or all bets get shakey. I would really prefer that traders hold the 685 area at worst on any type of early morning wiggle, and holding 690 would be even better. A drop below 685 really reduces the momentum of the news this morning, which doesn't kill the bounce, but takes a lot of the fun out of it.....a drop below 672 would kill the bounce.

7:50 am MT: Intra-day Update: This is the first wiggle test moment. Both price (SPX 700) and time (first wave is done) are lining up for a little pullback here. And that's what I want to see in order for a technical bounce to take hold, just a little pullback, not a big gap and fade like we have had so often recently.

Here is the 5m chart of the SPX showing the first potential intra-day wiggle point:
(click on image to enlarge)

The Shorts are really getting twitchy, because they just thrust the market a little more into the low 700's. This is actually a good sign, it means that the Shorts could potentially be a support to any intra-day pullbacks. Twitchy, freaked out Shorts always help the Bulls in the short-term. They may not do anything for the long run, but they should create more probability for a technical bounce today, especially if they can stay twitchy through the morning and mid-day.

8:00 am MT: Intra-day Update: The last twitch for the first wave is over, here is the first intra-day pullback, we'll see how it goes.....

8:53 am MT: Intra-day Update: The market pulled back ever so briefly before ramping again. The Shorts continue to be twitchy like a frog in a blender. This second thrust doesn't mean the market will make another huge run, it probably means that the Shorts will continue to cover on any pullbacks for the morning. At this point, I would like to see 695-700 hold on any deep pullbacks, and my drop dead line is 686. I speculate that we won't see any really deep pullbacks for a little while though, at least not until the Shorts exhaust themselves and have to run and grab some more Pepto. After the Shorts exhaust themselves, then it will be time to see if the Bulls will step in and support the market on their turn, which will get the Shorts all riled up again and give the market a chance for a strong close.

8:58 am MT: Intra-day Update: There's the pullback off the exhaust thrust. The market is likely to consolidate this area for a bit, perhaps in a Rectangle or Channel.

Here is a 5m chart of the SPX showing the start of a little consolidation:
(click on image to enlarge)

We'll see if the upper zones of the move this morning will hold and the market can build a bit of a momentum day into the close.

9:22 am MT: Intra-day Update: Looks like a Rectangle so far, which is what I speculated earlier.

Here is a 5m chart of the SPX:
(click on image to enlarge)

If the SPX (market) falls out of the bottom of the zone, I want to see it hold the 695-700 area in order for the market have a better chance at a strong day.

9:29 am MT: Intra-day Update: The SPX just broke out above the top side of the Rectangle, but I speculate that this is the Shorts freaking out again and the market could come back in to the consolidation.

9:40 am MT: Intra-day Update: The market did come back into the consolidation, so the bump was just some Shorts freneticism as I speculated. So the same thing goes as before, the market is consolidating a bit intra-day, and we'll see how it goes.

10:55 am MT: Intra-day Update: That was a nice breakout of the Rectangle an hour ago, which really increases the probability that today finishes as a technical bounce. This is turning into a momentum day, which means it's less likely to drop back below 700.

11:14 am MT: Intra-day Update: This looks like the third leg up on the 15m charts, we'll see if the market is starting to get a little tired or if it reaches for a higher high. The 725 area would be the furthest I would speculate the market is able to reach today, whether now or later in the day.

11:58 am MT: Intra-day Update: The third leg on the 15's is done. I mentioned in the comments to take some profits on a test back to the highs of the day, which is playing out right now. Taking some profits on the test a few minutes ago was the right thing to do.

12:05 pm MT: Intra-day Update: I think the market is going to form the rest of a Rounding Top on the 5m or 10m charts in the next hour, but I think that a collapse down the right side will just be a head fake. I think it will hold after a jab down attempt, which will cause the Shorts to get a little messy in the pants and bump things back into the close. We'll see how it goes from here, but so far, it looks like the technical bounce is still safe.

12:15 pm MT: Intra-day Update: It looks like a big part of the move today is in Financials and Energy, with some Tech behind those two areas. This is just the kind of speculative buying and short covering that you would expect in an oversold market that hasn't really changed fundamentally. Now it's a matter of seeing if there will be a couple more opportunities over the next several days - if the bounce will continue through the rest of the week.

12:32 pm MT: Intra-day Update: A lower high on the 5m charts of the SPX right now would add more probability to the Rounding concept I speculated about a few minutes ago. However, I still think any jab down will hold and not sell off into the close, but as always, we shall see.....

4:50 pm MT: Market Wrap: This is a quick wrap: It looks like the Rounding Top scenario played out just as I speculated earlier. The 5m candle at 12:45 pm MT was the jab down that looked like the confirmation of a Rounding Pattern - which I speculated would come right back. As per the speculation, the jab down was a head fake and the market shot right back up, and as per the speculation, the Shorts got messy pants over the price action and the market ran up right into the close. So the day played out as outlined. Today was a technical bounce that may lead to another couple of days of an upswing.