The heavy chop of the last week has occurred about 60 points shy of the clear-as-day 14085 rally target shown, hinting that it could be a distribution rather than a consolidation. A feint higher that actually reaches the target would make for a great bull trap, and so we should be ready to get short if it happens. However, we’ll need to be on our guard as well against the sucker-punch that would come by way of a sudden drop out of this zone. It would almost surely happen via a gap-down opening that has provided no great opportunity to get short. If the Dow were to open a hundred points lower tomorrow, for instance, few bears would be aboard, since they should have gotten shaken out already by the 100-point daily swings that have become all-too routine.
