I've said this in some other posts, so I might as well make it a new thread. Today's candle chart action did not play nice. The SPY gapped open, faded the open for the rest of the day and closed lower than yesterday's open. We call it a bearish engulfing candle. If price closes lower tomorrow it will confirm a bearish reversal pattern that is pretty reliable. It's called "three outside down" and for those of you from Missouri you can see it here:
http://www.candlesticker.com/Cs76.asp

Here's some chart reading speculation for you to consider. A number of wizards with no clearer crystal ball than you or me are projecting 1300 for the S&P before the bear market resumes.......a nice, long sucker's rally that should give you an opportunity to recover what was lost last fall and more (if you're sharp). Coincidentally, 1300 in the S&P would take us back to those golden days of August 2008 before the 401k turned into a 201k by the time pumpkins were being harvested.

IF the S&P eventually returns to 1300 later this year, we are right at the 50% retracement for that move. It would not be a coincidence if the market stalled and retraced here.........in fact, it would be a tribute to the genius of Fibonacci.

Happily, the pullback should be a buying opportunity, one of the likely few left in the run to 1300. Meanwhile, the pullback may be a bit stressful.......so buckle up, buy puts, sell calls, tighten stops and smoke 'em if you got 'em.

Bring it on!!

Jobs report just came out ... better than expected. Unemployment just came out...right as forecasted. Shocker! (sarcastic of course)

This caution from optionMONSTER:

The bulls have had a spectacular romp to the upside in the last two months, enough so that even the most optimistic of them are getting a bit nervous about sustainability. However, it seems clear from the action this morning that much of the herd is not going to go quietly into profit-taking or even a modest downtrend.

That in and of itself, on a pure sentiment basis, is a bit bearish and puts me in mind of the saying, "Take your profits or have them taken from you." But we shall see.