This past 2 weeks have been horrific I know. US economic data stinks and I can't see anything changing that any time soon. All I have is the charts, the price action, the volume, and the analysis and the analysis says the risk reward of a short play is not a good look right now. I am bearish because I don't think the budget cuts will be good for stocks with the econ data bad and getting worse, add to that the fact that the S&P 500 just closed under the neckline of a head & shoulder pattern and it seems like we'll get that 20% correction we were waiting for. But! Yeah, there's always a but.. But, a lot of times with head & shoulder patterns especially one's where the bar that breaks the neckline barely breaks the neckline like this one did you get a retest of the high in the head of the pattern. With this trendline right under the neck line I can see this happening. So my plan is wait and see if we break the trend line @ that time I'll get short, or bounce and test the high and @ that time I'll get short. Unless something like QE3, or better econ data is announced I plan on getting short because I don't think it gets any better from here for a while... Also, Ben Bernanke doesn't have to announce QE3, he can just hint @ it and this market will rock out so be carful trying to anticipate price... The market is littered with the bones of traders who tried to anticipate price.
Good luck traders, and protect that paper!!