With the S&P trading right at the June highs and the dollar testing the June lows the bears probably have a low risk entry here on the short side. One could place fairly tight stops at this point.
Lowry's buying pressure never did confirm this rally. It never picked up as the market rocketed off the 869 low. This rally was built on a decline in selling pressure only. That's not how bull markets should behave.
The selling on strength numbers are also suggesting some big money left the market today.
Now maybe this is another head fake and maybe it isn't. I will point out that every intermediate rally except one since the summer of 05 has seen one or more of these large selling on strength days.
I'll also note that the bear will make it as hard as possible for shorts to make any money. How tough will it be to take a short position if the market gaps higher tomorrow? I will point out that often the hard trade is the correct one. So if it's almost impossible to pull the trigger in the morning then you will likely be making the correct play.
One word of caution, the SOS numbers aren't always perfect timing tools as they are often early.
Market Direction Change
2 weeks ago