Well, the re-test of the recent lows is happening. Now the market will probably attempt to scare you a little. That's right, the S&P will try to shakeout as many investors as it can (below 1250), and the Dow will emerge as the strongest of the three major indexes.
Whenever you participate in "edge of the cliff" investing, the markets have a tendency to become increasing volatile towards the tail end of a cyclical bull.
The correction we are experiencing is minor (5-10%). These type's of corrections are usually followed by one more attempt of the recent high's. The reversal of the current correction will probably coincide with speculation that the fed will pause later this month. Once this rally occurs, papa bear will emerge lead a further decline in the dollar. This event could mark the end of the cyclical bull market.
As far as timeframes are concerned, the recent correction should end soon, the rally should start at the end of the month with possible new highs on the Dow by mid-summer. In the late summer or fall, we may see the beginning of a major correction.
