I have been very impressed with the recent run by the bulls. They were able to take the market past the recent 61.8% retracement (SPX=1085) and actually close above it. Does this mean that the downtrend is over and that a new uptrend has started? Not exactly. The trend is still down for multiple reasons: 1) 50 DMA is below the 200 DMA, 2) SP500 still closed below the 200 DMA today, 3) We still have lower highs and lower lows on the daily chart. Given all of these facts, I think we should not get too caught up in this recent rally but at the same time we should heed caution about shorting at this time. Until we see a breakdown in the upward momentum (use the 30 or 60 min charts), I would not take on any large short positions. I expected a breakdown near 1085, but that did not happen. So, for now, patience pays. I am waiting for one of two things to happen: 1) the market breaks down on the 30 or 60 min time frame, potentially signaling a short, or 2) the market continues its advance and closes above 1131 which would then change the trend back to neutral or potentially start a new uptrend. I think the market has advanced too far too quick and #1 is more likely. Let's see...