From a BIG picture perspective of the S&P 500 Depository Receipts (AMEX: SPY), my sense is that the price structure is traversing a range between 149-150 on the high side, juxtaposed against 145 to 143.50 on the low side. A climb above 150 should trigger a run at the July high of 155.53, while a break of 143.50 should trigger downside acceleration towards a retest of the August low at 137.

Today's weakness has press the SPY mid-point of the range. However, my near-term work suggests that in the 146-145 area we should be looking for another turn to the upside for a run at the top of the range (150). For the time being, I am content to "trade the range," unless price action tells me the range is no longer the dominant pattern.

By Mike Paulenoff

Mike Paulenoff is author of the MPTrader.com (www.mptrader.com) , a real-time diary of Mike Paulenoff's trading ideas and technical chart analysis of Exchange Traded Funds (ETFs) that track equity indices, metals, energy commodities, currencies, Treasuries, and other markets. It is for traders with a 3-30 day time horizon, who use the service for guidance on both specific trades as well as general market direction

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