A Short-Term Trade in Index ETFs

A short-term trade is opening up in the index ETFs, and the next few sessions will be crucial. So whether you play the Spyders(SPY Quote) or the more active double and triple or sector ETFs like the ProShares Ultra S&P 500(SSO Quote) and the ProShares Ultra Short S&P 500(SDS Quote), a move seems to be brewing, and a trade is about to materialize.

There are two ways to view the recent decline in the stock market. Either this is the continuation of the bear market or the makings of a new bull market.

Let's lay out the case for both scenarios from a technical standpoint. The stock market's biggest percentage rallies were bear market rallies followed by even lower lows. The following widely published chart is very powerful and scary:

Bear Market Rallies CQG, Inc.

...