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Incredibly enough, SPX has now given up over 300 points just since Tuesday’s intra-day peak in S&P Futures following this week’s CPI report, or around 7% from those highs at 4180 just three days ago.  This decline certainly has proven lightning fast for a normally bullish December.  However, there were ample warnings regarding breadth deterioration, defensive trading that certainly discussed the possibility of yet another trading top just as the 80-day trading peak began to roll over.  Overall, I do not suspect this will be a straight shot lower into year-end.  Technically speaking, there is evidence as of Friday’s close that a bounce is approaching.  However, given the nature of this week’s selloff, there still looks to be a further window of weakness into late next week before a final week rally.  Targets for a decline could materialize near 3725 which would equate to a 61.8% Fibonacci retracement of the rally off October lows.  One should consider that bounces early next week likely won’t recoup more than 50% of this week’s selloff before a bit more weakness.  Yet, my short-term cycle composites still show a good chance for a late December rally.  Overall, I feel that volatility...

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