S&P 500 - 30 Min Chart - 20 Days
Today's rebound after the declines of Friday and Monday got the CNBC folks all excited this morning. It wasn't much of showing by the bulls (the blue price bars on the right of the above chart - kinda puts it in perspective), but I guess from the bull point of view, at least it wasn't another down day.
I've mentioned several times during the past few weeks how crucial the 990-992 area has been as a support/resistance area for the S&P (especially support). As I think I stated this morning (and I know several other times when discussing support/resistance), when a particular price area serves as strong support when prices are above it - and 992 did the job admirably before being gapped yesterday morning - then it's likely that it will also serve as strong resistance once prices are below it. And that's what happened today - the S&P got as high as 991.20 in today's little bounce.
No idea what will happen tomorrow (actually I do know, but I've been sworn to secrecy 
), but keep an eye on that 992 level. If the bulls are going to make any kind of comeback and try and salvage things, they absolutely have to get past that resistance area before marching again towards the Valley of Death. If they can't muster that strength, then there's little hope for them.
I got into an online fight the other day with someone who (apparently proudly) doesn't know anything about charts but is extremely opinionated about the market. My point was that after that last try that hit 1013 the day before and failed and then opened the next morning sharply downward, that it "looked like" the March rally was finally at an end. And we got into a big fight because this guy claimed that I was basing my argument on one day's observation - and that therefore I was "wed to predictions" as opposed to "watching the market and then deciding" as he thinks successful traders should do.
The point that I was unable to get across to this guy is that chart reading isn't based upon making an emotional decision/prediction based upon one day's worth of price action - that knowing and following a situation like this 992 support/resistance line (or knowing that the S&P has bounced off of the Fib 38.2 at 1014 several times and failed) gives you a better feel of the importance of the meaning of what actually does happen (or, just as importantly, doesn't happen). The charts are always creating certain crossroads which, depending on what happens when they are reached, give guidance to future market direction. My point that the March rally "looked like" it was finally over wasn't based upon a single observation of the down morning on Friday - but on 2 weeks of watching the S&P bump against that important Fib ratio and then retreat. That's what knowing this stuff does - it gives you eyes and ears to see and listen (figuratively, of course) to the clues that the market is sending out. And this 992 support/resistance level and how the market reacts to it is currently very much one of those clues.