On the S&P 500 we have a potential head and shoulders formation being created with the right shoulder forming now (technical goobly glock) - this would be broken if - again - we can break back north of S&P 940s area. S&P 915-925 would be where I'd expect the market to fill in the right shoulder and then from there we wait to see what happens next.

I had tagged S&P 915-925 as the "right shoulder" - we closed yesterday at 927, and briefly traded up this morning but if we don't get over S&P 930 ... I'll consider it close enough for government work.

This is what it looks like today:

For those not familiar with technical analysis this is a negative outlook in the intermediate term, marking a general exhaustion of buyers and a pending reversal. Once the "neck" is broken you tend to have some very hefty selloffs.

If indeed the squiggly line analysis is correct, S&P 880 is the line in the sand bulls will want to hold on any major pullback - where we broke out from in April and multiple tests of it in May.