In some of my previous posts, I made some forecasts of what I thought the S&P 500 would do. In my previous post, I spoke about how the S&P might be making a running or expanding flat pattern. I am still under the belief that this is going to happen.
Looking at the 4 hour chart you can see we are still on a downward move and have yet to break out of it. The current move up might take out the trend however, it could very well make a consolidation pattern and be extremely volatile the next couple days until we see a breakout in either direction. If you are looking to trade the chart, I would wait until we see a breakout of this trend-line before entering the markets.
I can see the markets trading down for the next day or so until we see a significant breakout to the upside to test that upper resistance. We could see a simple ABC correction before seeing more downside or we could be in this consolidation pattern for a longer time. Right now you have a buying opportunity so be patient and wait for the break and set your stops at the low so you can protect your holdings.