The ProShares UltraShort S&P (SDS) plunged to a new low this morning at 50.43, but has since recovered to 50.99, just 3 cents from unchanged on the session. My pattern work argues that the SDS ended the most recent downleg from the May 24 recovery peak at 52.71, which in and of itself is reason to expect some type of rebound. However, my pattern and oscillator work are "warning" me that perhaps a more important low has been established ahead of a larger, more intense counter-trend recovery – that projects to the 53 area at a minimum and possibly to the 55 level thereafter.



Mike Paulenoff is a 26-year veteran of the financial markets and author of MPTrader.com, a real-time diary of his technical chart analysis and trading alerts on all major markets. For more of Mike Paulenoff, sign up for a free 15-Day trial to his MPTrader Diary by clicking here.