Initially futures were up overnight on the announcement on Sunday evening of the bank bailouts but didn’t last as selling came back in early this morning that took S&P 500 futures down to a new swing low before the cash open. I’m penciling in that overnight push up as the first leg in a bounce and the low this morning as a wave ‘b’ type low. That implies a steady rise out of the morning low which fits the price action post the open pretty well. So far the late morning high is against initial wave [II] targets in both futures and cash. Was that the wave [II] high? Maybe. I don’t think we will know until we get the reaction from the CPI numbers tomorrow morning. I do give bears points on giving it go over the last hour or so.
The move up in bonds this morning invalidated the prior wave [IV] idea but I’m reluctant to give up on a lower high just yet. Fair to wait for some proof of a lower high kicking in like a drop back under 130^25. Overhead resistance at 123^03 and 132^28.