Stock markets' relief rally may be brief, or extend - levels to watch

It isn't that I want to complain, it's that there remain key levels the markets are struggling with and would need to conquer before looking safe for serious long entries. The SPX poked over 1074 but didn't make 1082 (yet) let alone above ... and let's not even talk about 1100 yet! The hourly SPX remained controlled downward by its short-term 34-hour MA, and the index couldn't close above the 1074 level it has tested. Sure, the one-day gain was a great move, I'm just talking about stepping back to gauge things. The daily SPX remains dangled above its 200-day MA. The $BKX banking index (not shown) closed under its 50-day MA - again. Indicators on the SPX chart, and my TRIN chart, below, show the index really can go either way. There are hints of positive divergence, and the TRIN's MA's (the ones greater than the 3-day MA, anyway) are all over 1.2 so technically the stock markets are oversold. But today's jump brought today's TRIN value under 0.80, so it's possible the move was made today. Interesting thing, my sense is that if the market does weaken again, it doesn't need to be a devastating 3 of 3 down yet; it could just get to the SPX' 200-day MA, and the potential symmetry levels like SPX 1027/1030 and US dollar index $USD 80.80, and THEN have a good bounce.

But the markets won't necessarily listen to me - it's us, who must take the market's temperature and figure out where it's going. So I added the VIX chart - the VIX closed over its 200-day MA. So that's another cloud. It's all making me think that if the equities markets make a bigger rally over 1082, 1087 from here, then we may have to kiss symmetry goodbye and brace for much lower levels once the rally gives out.

Funny that the excuse for the rally was the Eurozone rallying to support Grece with their bonds situation. That acted to release some buying pressure for US Treasuries, and the TLT (ETF for Treasury bonds) dropped rather well later in the day. Maybe that will become the trigger for the TBT trade we've been anticipating for over a week now.