The Bernanke managed to not send the markets down this time. He struck as neutral a tone as possible, giving both the bulls and the bears something to hang their hats on. Bottom line: no impact. The climb to 1320+ should continue as planned.
The current retreat, as discussed yesterday, should be contained at 1287-ish, the trend line that marked resistance on 6/7, 6/9 and 6/14. That resistance is now support and should limit any further sell-off on the day. That TL also coincides with a longer TL connecting the 4/8 high to the 4/20 gap and the 5/23-5/25 and 6/2 bottoms. It runs parallel to the major fan lines of its big brothers from the 5/2 and 2/18 tops.
These prices probably mark the last best chance for bulls to play this bounce to 1320 or so. The short term technical indicators are all oversold, while the 1 hour and 30 minute now have sufficient room to make another run to the upside.
We should see another pause around 1310, but there’s also a small chance that this .50 retracement of the 6/1 highs counts as the equivalent 10/31/2007 .618 retracement before that market’s final push to 1523.