According to "Equal up and down" rule, down swing 3 days then up swing 3 days, the up swing advanced more than the down swing, so bulls won, this means probably the bounce may have more legs. But because of 2.8.1 CBOE Options Total Put/Call Ratio, normalized CPC is still deep inside the bearish area, so I don't think that the market can go much far. Short-term, the story still is 0.0.4 SPX:CPCE, firework, until when day the market opens with big down gap. Tomorrow, according to chart 7.0.4 Extreme CPC Readings Watch, because CPC < 0.8, so 67% chances the market may close in green.
7.1.0 NYSE Composite Index Breadth Watch, "Equal up and down" rule, I annotated a past instance, which should enough to explain why this bounce may have more legs.
0.0.5 XLY:XLP, I've noticed that recently the consumer discretionary sector outperforms the consumer staples sector, this is a bullish sign because this means that the money dare to fly out of safety seeking more risks. Today the chart generates a buy signal, combining with 0.0.4 SPX:CPCE and 7.1.0 NYSE Composite Index Breadth Watch, so far we've had 3 evidences arguing for more up legs, this is good. By the way, if you observe trading signals from 0.0.5 XLY:XLP carefully, you will find that you can hardly earn any money simply by following buy signal to buy and hold until sell signal to sell. While if you follow the sell signal to short hold until buy signal to cover, you're more likely to earn money. This well explains why in a bear market we better follow the sell swing. When in a buy swing, we should wait for a pullback before entering long and above all, always remember to take profits as you cannot rely on sell signal to exit. Anyway, I just want to emphasis that in a bear market taking long is far more difficult than taking short.
1.0.3 S&P 500 SPDRs (SPY 30 min), 1.1.5 PowerShares QQQ Trust (QQQQ 30 min), possible bounce target and the major resistance. I don't remember for how long that bullish pattern such as Head and Shoulders Bottom has failed to work. So I'm not sure either this time.
2.8.1 CBOE Options Total Put/Call Ratio, this is the main reason that I don't think that this bounce can go much far as the normalized CPC on the bottom is way deep inside bearish area, unless a bull market has started. Well, you don't really believe that we're in a bull market now, do you?