The market is looking pretty scared right now. It rallied a little, and then sold back off into the close. Tomorrow night is what the market is waiting on. Although I think we will go up into the events, it is possible that we sell off tomorrow in anticipation of bad news from Obama... (which never happens as he's a great liar) and then start the 2-5 day rally from the low tomorrow.
It's hard to guess at this point? I'd only recommend that if you are already short... stay short. We are either going down into the events (FOMC meeting at 2:15 and State of the Union after-hours) or down after them. Either way, I expect 108.00 to be hit. I will look to close my shorts there... assuming that it doesn't pierce the level with huge volume!
That's one of those "iffy's" as I'm only assuming that it will hold on the first hit. Now that's on a "closing bias", not intra-day. I do believe we could pierce it intra-day to suck in more bears, and then close right at the support level... which could setup a good place for a bounce... with "could" emphasized!
This is a tough place to be if you aren't already short. You Damn sure don't want to go long when it hits 1080, as it's way too risky! So, you hope for a rally into the FOMC meeting, or a rally on Thursday (after Obama yaps his jaws late Wednesday night).
I'm sure our smart President will save us from this mess we're in... right? After all, I know how Patriotic he and his wife are... just look closely at how well they honor the Pledge of Allegiance by holding their right hand over their heart (ops... that's their left hand! Must be a new trend to use your hand with your wedding ring on it?)