The market has traded above 1290 overnight but it is now, quite surprisingly, for me, around 1284 in spite of yesterday's behavior and close. However, if it does not go below 1282 after the open, the cup & handle pattern on the SPX is still valid and there is a big chance of renewed buying until tomorrow.
The put/call ratio has barely moved yesterday with all the upside in the stock market:
This suggests that bears are still looking for continuation of the last week's drop, a bullish event for the next 2 days of trading. In this context, if the SPX starts moving up and closes strong above the 7 h EMA, I may add to my short term longs. I do not expect the put/call ratio to be very strong or even reach overbought as this is the normal behavior before a bigger correction.
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