This little rally attempt on the gap up here on the China is not going to zero relief will not last long. I give it one day tops, for this bounce. We are in a fragile psychological state and we haven't gone down to low enough levels just yet to satisfy the margin clerks.
The technical damage from the selloff after the Fed announcement is significant. 1600 was broken easily and there is carnage in the bond market. This will have repercussions that will last for a while, so I don't expect us to just shrug off the peripheral weakness. Yes, the S&P is the strongest market in the world, and it will be where the investors will flock to when the coast is clear.
It still seems as if traders are trying to play for the bounce, and don't want to miss a good buying opportunity. The capitulation may take a bit longer than I expect, but we should see it this week.
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