S&P

Here is an hourly chart of the S&P futures.

The rally late Friday had no follow through and the market is headed for the bottom of its current box at 1180. My guess is that it will drop a little below there, probably to 1178, before it rallies again. There is an outside chance that the 1167 level (the London bombing low) will be reached or even broken a bit, but that is the worst I can see on the downside.

Looking at the bigger picture, I think that Friday's late rally was the intial stage of "base building" and that the stage is beging set for a rally which will take the market above 1300 over the next few months.