The whipsaw seen during the last trading week was fustrating for both the bulls and bears, as both sides are forced to take shorter duration trades to adapt to the market. There are convincing arguments for both sides of the market now. The long- stronger corporate profits in US, undervalued stocks. The short- non-sustainability of yet another US bailout; Euro collapse, global recession.

In my opinion, this is still a range bound market until both extremes have been tested with significant chart patterns. The short term volatility will continue to kill traders unless very wide stops are used. For now, the market seems inclined to break below 2825 support. A persistent sell off from here will see the market testing 2700 lows again. The USD is experiencing a rally, which traditionally causes the market to sell off. Hence we do have a downside bias, but i think one needs to ......