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The hourly chart is now oversold, so I would perhaps look for a modest move higher in the S&P before adding to short positions. On the daily chart the index traded and closed below the trend support drawn from the November 2012 low and there would be a number of momentum-focused traders who would be keen to look at more bearish structures now.
In the short term we may see support come in on the index at 1724 (the 61.8% retracement of the October to January rally), ahead of the 200-day moving average at 1707.
In terms of drivers, the US calendar doesn’t really have a huge amount in store until Wednesday when we get the services ISM report. Given last night’s manufacturing print was the key trigger for traders to take risk off the table, the service print could get a real look in, especially as retail contributes such a significant contribution to US growth.