My very short term outlook (several days) has changed. I now expect a multiday direct rise until the EU summit on Thursday. Then, I expect a further drop just below the 200 DMA.
The main reason for this move up is the way the market tries to anticipate the outcome of the EU summit. This scenario is confirmed by yesterday's strength after the lunch.
I expect this rally to stop around the SPX 1330 daily resistance and be followed by a further drop to the 200 DMA because I think the market will fall into the Q2 GDP report on the 29th and also, because I noticed that this is a good general roadmap for bigger corrections. Here is the January 2010 correction:
A match between what is expected to happen now and what generally happens suggests the scenario has some good odds of success.
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