Bears Appear to Win Standoff

Yesterday's standoff between multiple failed attempts to hurdle and sustain above 1375/76 in the Emini S&P 500 (e-SPU) juxtaposed against the intraday bear trap low at 1366.00, appears to have been won by the bears, at least so far today, with the e-SPU breakdown beneath 1366.

In addition, let's notice that yesterday's upside failure occurred against the resistance line of the near-term price channel, while subsequent weakness has traversed nearly the entire width of the channel towards a test of the channel support line, now at 1358.75.

The onus is on the bulls to preserve the lower channel support line, which if violated, should trigger additional weakness into the 1355-1353 area that represents this week's prior upside breakout plateau in the aftermath of Bernanke's Congressional testimony.