I had a really nice long post last night - and hit the wrong button or something and it disappeared. You know how these things work. So here's an abridged version.
It's always a good idea to look at different time-length charts to gain different perspectives on the market picture. With that in mind, I'd like to talk briefly about the virtures of the 3-day chart.
S&P 500 3-Day Chart
The 3-day chart has the advantage of smoothing over all the noise and drama of the daily and intraday charts and allowing a bigger picture to emerge which is perfect for my type of trend-watching. Look at how cleanly it shows the last 9 months of market action, presents a great depiction of the lately violated triangle, and illustrates very nicely the after-effects of the triangle violation..
By just looking at daily and intraday charts there may be a tendancy to jump too soon - "OMG! the market is up today - it was down yesterday!- what should I do? "- sort of stuff that is put to rest by looking at the bigger picture. The movement in each 3-day bar is much smoother in illustration of the trend than would be true of the daily chart. It's much easier to determine of ongoing up- and down-trends are being sustained or violated.
Some general rules - in a downtrend, be concerned if the high broaches the high of the previous 3-day bar. In an uptrend, look for a low which goes lower than the previous 3 day bar. Combine these rules with any meaningful chart patterns (such as support/resistance areas presented by the triangle) or meaningful or interesting support/resistance areas or Candlestick patterns on the daily charts and you should have a better feel whether an existing trend is intact or has changed. I firmly believe that jumping back and forth based on shorter term movement from the daily and intraday charts is only going to bite you in the butt.
So lets take today, for example. Here is a daily chart showing the past month
S&P 500 - Daily Chart
Note that the 3 bars in the yellow box correspond to the last bar in the 3-day chart above. The high for those 3 days is 797. Even if there is an up day today, I wouldn't abandon the current downtrend as violated unless that 3-day price high of 797 is violated - and also notice how nicely this fits with watching the 800 support/resistance level.