"Uncertainty is a certainty. Embrace it, because you can't escape it."

--Kelly Martin

NEW YORK (Real Money) --The big intraday reversal on Tuesday had market players feeling more optimistic, but it turned into a bull trap as the Chinese markets crashed further overnight and the Greek uncertainty dragged on.

Despite the efforts by leadership in Beijing to prop up the markets, nearly half of all stocks on the Chinese exchange have halted trading. This has caused even more pressure on the remaining stocks, as investors are forced to liquidate to cover margin calls. Security regulators in China even used the term "panic sentiment" to characterize what is going on.

Until the last couple days, markets outside of Asia had pretty much ignored the meltdown in China. There have been some headlines about the bubble popping but for the most part we have remained focused on Greece and interest rates. China was seen as being contained, and since it still was up substantially for the year, it wasn't that big of a deal.

The crisis in China has now accelerated to the point that it is spilling over to the rest of the world. We already have an undercurrent of unease caused by Greece, and if a miniscule economy like that can cause so many problems, we can't be ignore such chaos in the second largest economy in the world.

China is causing some issues this morning, but overall the market has handled the Greece crisis fairly well. We've had a couple sharp dips but have bounced back, and the reversal yesterday after some extremely gloomy action in the morning was impressive. The mood on Tuesday morning was as bleak as it has been in a while, but there still was support out there.

Market players have been well conditioned to buy dips. They were hesitant yesterday but ultimately they regained their confidence and went back to work. They are going to have another opportunity to buy weakness this morning.

One problem is that the more often bounces like yesterday failed, the less of an inclination there is to buy the dip. After traders are trapped a number of times, they lose their zeal for being weakness buyers pretty quickly.

Another good bounce wouldn't be a surprise, but we have substantial headwinds to deal with. Greece has a new deadline to present a deal. The eurozone has given them until Sunday to finalize something. There are some very serious discussions about an exit and it certainly is a possibility.

In addition to these ongoing headlines, we have the minutes of the last Federal Reserve meeting due out this afternoon, which will cause some discussion of interest rate hikes once again. With the chaos in Greece and China, right now there is little appetite for higher rates, but it is a fear that the bears will use if they can. With the market already under pressure, even a slightly more hawkish Fed could be an issue.

While the reversal yesterday was a technical positive, a move like that needs confirmation in the form of a follow-through. A strong bounce indicates good support, but it can fail fast when we have the sort of news environment like we have now.

We haven't yet seen a full-fledged downtrend emerge, but a failure of yesterday's bounce is going to be a major negative. We have had a series of good closes lately, which have helped, but under the surface this market has already suffered substantial pain. There are few places for the bulls to hide right now. Traders may enjoy playing volatility, but as far as building longer-term positions, there isn't much to do right now. Most charts look very poor, and bottom fishing requires patience and caution.

Typically, we have seen futures bounce back from this sort of weakness before the open, but right now things are highly emotional and driven by the next news headline. There simply isn't any easy way to predict how things will play out from here. The best approach is to stay vigilant and manage capital very carefully. There is nothing to indicate that the worst is over.

Editor's Note: This article was originally published at 6:36 a.m. EDT on Real Money on July 8.