The S&P currently looks ready to go on the daily if we get a break of Friday and today’s highs. We’ve bounced nicely off the 200sma and closed above the 200 ema since testing these levels last Thursday. On the daily chart a run to the top of the megaphone pattern looks likely to occur but will likely take some positive news flow to get the market motivated. From a contrarian perspective there are plenty of reasons to be bullish but we must remain conscious to the reality of the systemic properties of Greece and if the issues are not resolved serious impact to liquidity in the credit markets will be observed and will quickly spill over into all other risk classes. Now, do I honestly believe Greece will default? There is a possibility but I think there is too much “big money” at stake for the leaders of the ECB and Eurozone nations to allow such a reality to develop. In essence what I am saying is just as in the US, large players have large leverage on government decisions and it tends to fall in their favor. So i am still bullish on the S&P, now regarding my Friday post on my “risk/reward” trade my mental stop was the lower trend line of the channel. When Moody’s came out with their potential downgrade of Italian debt the market rolled over hard and broke that trend line. Honestly the news in my opinion should have already been priced in and Moody’s credibility is nonexistent in my mind as well so I waited for a retracement and took one contract off at a small profit. Anyway we will see what tomorrow brings looking for more upside but this market can roll very quickly, the 200 SMA remains critical support we break there 1250 will come into view quickly.