As you see in the chart above S&P500 has been moving in a narrow uptrend channel (see the chart in yellow). As long as S&P500 stays in this channel bulls should have the upper hand. I covered my shorts at 1305. I'm betting on market to bounce from 1300 support level.
As you know I'm a contrarian analyst therefore despite the moaning and crying of talking heads on CNBC I'm going against the crowd. I think market is not ready for 10% correction yet. We are in the process to form a topping formation, I'd like to see a lower high before we start the next leg down. Therefore there is no point to panic. I think the potential for a strong short-squeeze is too great therefore it's too risky to go short until S&P500 makes a lower high or violates one of the major support levels. If you don't feel comfortable to be in market you should go to side line for a while until the dust settles. Meanwhile pay attention to 1300 as important support level, if S&P500 breaks it, the next logical support would be 1286. Please note we could get a fake out for a day or two to trap the weak hands before we head the other direction. If bid institutions send the market higher and S&P500 closes above 1315 we are going to get a big short-squeeze.