Tuesday the SPX started the day negative and sold off down to the mid 890s before staging a late day comeback rally that closed up around 910. It was definitely a nice rebound but only gets us back to where we struggled to hold onto on Monday. There is a bit of resistance in this mid 910s area and it sort of looks like the market could be forming a decent head and shoulders pattern on the 30min chart going back to last week. If we do break that mid 890s level then the H&S would confirm a move down to 875 possibly.For Wednesday I think its best to begin neutral and allow the market to tell you if it wants to get over 915 or not. The pivot for Wednesday is at 909.50 on the ES futures. That should be a good line in the sand to determine the trend for the day. Again, we are very overbought but that doesn't mean the market will selloff. I'd rather wait for the market to tell me its tired and a break below 895 would probably do that for me. Otherwise we could still see 950 tagged this week before options ex. Trade safe.
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