Critical Ichimoku Point

We either bounce off the cloud here or penetrate into bear territory. The intersection of the red and blue line indicate a strong or weak market trend. In this case, we've already turned weak and are trying to cross upwards back into a rise. Penetration into the cloud could indicate a sharp decline in price to come soon. A healthy bounce off of the edge of the cloud could indicate a new step up in price. BBands are also slightly squeezing at this point.

Comment:

Next important factor is whether 12600 holds. For the short-term bull a huge pennant/flag in the works so that would consist of a bounce off of bottom of cloud, up to around top of cloud over the next week. End of the pennant would be a good place for a big market move (much bigger than our Korea scare last night)

The chart history shows a lot of fakeouts when breaking the bottom of the cloud before a rise (March 25, July 16 for example). I'd be skeptical of shorting a big breakdown without solid confirmation.

Comment:

Looking like more of a bearish wedge than a pennant now.