Bears shouldn’t break out the bubbly yet, since bulls were not exactly diving for cover yesterday; they just seemed a little fatigued after it became apparent around mid-session that there wasn’t enough short-covering nervousness to move the broad averages higher. That’s understandable, considering the squeeze was in its fifth consecutive day. Now, we should look for DaBoyz to manipulate stocks lower in order to “discover” a price at which selling dries up. This is a dynamic process, since the news environment will be changing, and the selling could conceivably start to feed on itself if it shows any success. For the moment, however, given the precise bounce off a 1919.75 Hidden Pivot support (see inset), short-term, technical signs are neutral. My gut feeling is that night owls will enjoy better success positioning from the short side nonetheless, but set an alert just above the two numbered peaks, since that’s where any rally would turn menacing.
