Morgan Stanley bear trap has not triggered yet.

In this post I suggested that if the strongest of the bankers can break out of a downward wave count that the current rally has legs.  Not breaking out yet is not proof of anything; the only proof of anything would be if MS breaks above the trigger.  Until then, a new bull wave is not confirmed.

To be fair, the move from top left to lower right does look corrective a-b-c.  But this move followed the end of a rising wedge.  So this could be a motive wave that turns into a failed 5th.  Or it could be forming the next move to the top of the rail.  But if a strong sell off does not begin pretty darned quick then I'll probably go to the sidelines until I see clear evidence of new power selling.

Something to watch for here would be a pull back to the 33.13 level without continued follow through.  That would smack of a retracement and would be clear sign to cover shorts because the next wave up would be a 3rd and that would imply a 4th and 5th.  The key here for shorts is preservation of capital while the leveraged longs pull out all the stops just in time for interest rates to begin rising on them making their margin-leveraged positions unsustainable.  At the end of the day it will not be the shorts who take the market down.  It will be the corrupt weight of the leveraged longs doing a 911 on themselves.

But, one day at a time, shall we?