The next few days in the ES/SPX are going to establish market direction for the next several months or longer. If there is significant follow through selling then the idea that a major long term top was established over the last couple of months will go a long way towards being proven. However, if that follow through selling doesn't materialize then we may have seen (or will shortly see) an Intermediate term low that will be followed by at least 100 points of bull market. The alternates look like this:
BEAR COUNT
BULL COUNT
Seasonal tendencies over the holidays and into January are bullish. However, market technicals have a bearish cast to them. The McClellan Oscillator and Summation Index both diverged against the recent highs and are in downtrends that appear to have some distance to go:
Same can be said for Al's Indicator which has momentum, volume and Adv/Dec components:
