The S&P is a dragon for bears. It is not an easy foe. The uptrend has been ongoing for so long, that it will take multiple daggers to kill this dragon. It is probably smarter to take on easier prey, or take a bearish view in a different way, such as going long Treasuries, or short the Nikkei or China, or going short the USDJPY. Yes, I am feeling bearish these days, it seems we've reached a price point where it will be difficult for the market to add on gains. But at the same time, there are so many who were left behind in this neverending rally that dips will be bought for a while.
A day like Friday hasn't happened since last fall. I don't remember the last time we had a panicky selloff into the close on a Friday. It may have been last October. It is a shift in price action that is quite different than what we've seen for 6 months of dips being bought instantly. I do think we will probably trade back up to 1650 soon, but I don't know if we get back to 1670 soon, which is what would be the pattern for the past 6 months where dips didn't last more than a week.
Its probably not a good time to short just yet, but I think rallies can now be sold short without fear of it going to new highs.
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