The large downtrend shown tripped a ‘mechanical’ short on last week’s rally back up to the green line, but I’m going to pass this one up rather than try to be a hero. The first rule of the ‘mechanical’ trade is to initiate them only when you are confident that a ‘D’ target– here 1669.25 — will be reached. In this case, however, although the bearish pattern is well confirmed by the precise bounce from the red line, bears have yet to escape the vicious squeeze begun from last Thursday’s low. Although shorts can still be initiated via ‘camouflage’ using the pattern, since the green-line signal noted above has in fact been triggered, the hourly chart doesn’t look too promising for bears at the moment. Actually, if this short-covering rally continues above the 1940.00 point ‘C’ high of the pattern, after having gone no lower than p=1804.63, it would be warning bears to dive for cover, since, by my runes, a possible test of late December’s highs near 2075 would become no worse than an even-odds bet at that point.________UPDATE (7:02 p.m.): Tuesday’s short-covering spree, which peaked at 1992.75, did not change the outlook and analysis given above. The futures would need to dive below 1833.50 today to even hint of possible trouble in Wall Street’s delusional Shangri-La.