Today Should Tell The Tale

The S&P closed above the 61.% retracement of the 1230.71-1140.13, inside the zone I was citing yesterday on Twitter -- 1196-1200.

I thought I was raising eyebrows by calling for 1186. So even I was surprised by the market's strength. It just shows that the market loves to go further than you think it will.

Today I'll be looking for at least a partial retracement of the move from 1140.13. The 38% retracement is in the 1176 area, and last Friday's close was 1173.97, so these spots could have some magnetism.

Judging by the 1198.43 close yesterday, the real possibility exists for the 1230.71 highs to be tested and even exceeded. Today should tell the tale. I'll be noting just how low the market can get. A shallow probe lower that is forcefully reversed could have me playing the upside very quickly.

Alternatively, if I'm reading the overall pattern correctly, today's highs (or slightly higher in a few days) could mark the first leg of the bounce. A deep retracement would make me feel better about this scenario.

I tested the waters with some speculative puts yesterday when price met my objective, SPY 115s. My intention was to hedge them, but I missed the opportunity (lunch). I do not intend to miss my opportunities today.

ADDENDUM: forgot to add that there is a small gap at 1204.42 that may be an upper target.