Markets started this week with my expectations that a move down from 1700 would occur and a possible major high was in at 1700. We hit 1699 1 point from target spot and began a move down from there.

I mentioned to all readers that I needed to see how the “price/action” was during the move down from 1700 SPX. If it was a corrective move down , it was likely just only a pullback – if it was a SHARP an fast sell off – it was likely that 1700 was a MAJOR top.

So far I believe it was a corrective pullback – and this means that bears still too weak and bulls strong – so I believe the rally is not done yet and a blow off move above 1700 could occur next from now.

However take notice – we still have MAJOR intermediate warning signs with the bearish divergences in place – so I’m thinking this could be possible the last blow out move high to make every single short stop out above 1700.

We have FED meeting on Wednesday and as always – ANYTHING can happend at FED meetings.

Again as we have bearish divergences all over the place – weekly, daily we need to keep in mind that this rally could stop anytime soon.

I would prefer the last blow off move above 1700+ and probably go a lot beyond 1700 – just to make EVERY SINGLE short stop out – before a turn in the mkts.

A text book target is 1720 but if we clear this – I can easy see us go up near 1750.