As everyone begins to celebrate the rally, and declares the low is behind us, it is time to look at fundamentals.

The commercials are selling this rally in a weekly downtrend, the perfect scenario for a large move down. We are a little early on the seasonal, and the short term trend is strongly upward. As a result we could continue up for a bit, but when the music does stop here and we begin to drop, it will be important to see if the commercials begin aggressively buying the dip. If they do, the suits are correct, if we see scale down selling, the drop could be breathtaking.

When I take in everything I study, alot of which I do not place here for free due to it's proprietary nature, I have seen nothing that tells me we will not make lows under 6500, possibly quite a bit lower than that. However, the trend is up for now, so I am mostly looking to buy the dips and short extensions upward as we are entering an overbought zone. In other words, play both sides for now until the downtrend re-establishes itself. I think we will have an upward bias for about another month or so, but I will dial in dates tighter as we approach the sell zone.