The countertrend wave (B) rally that began late Friday afternoon continued today, albeit without much to show for it. It appears that wave [a] completed this morning and wave [b] is underway. Wave [b] may already be complete which would lead to an immediate rally tomorrow morning, but there is always the possibility of a flat correction where wave [b] makes a new correction low followed by wave [c] up. A triangle is also a possibility, but we will need more information before coming to that conclusion. If the market breaks down below Friday's low on strongly increasing volume and breadth then the rally may be over.
While I believe it to be a remote chance, if the Dow were to fall damatically below 9556 over the next couple of days, then I would have to reconsider the above analysis. The equivalent level for the SP500 is 1011, and for the Qs it's about 41.20. Of course we may get down to those levels by the end of the correction. I am just not expecting it in the next two days.
It looks like it will pay to remain short during this countertrend rally if this is all the bulls can muster, but I suspect they will try a little harder before the week is out. While it is a subtle point, the MACD on the 15 MIN and 30 MIN charts made a slightly higher high than it did during waves [iv] of 3 and 4. This suggests that there will be at least one more rally attempt.