Divergences

As we head towards retesting the lows at 1040, there are quite a few bullish divergences. 

• European and Asian indices are outperforming the S&P.
• Crude oil is relatively strong and will likely make a higher low.
• Euro is not falling apart and hanging on to most of its gains from 2 weeks ago.

I see no bearish divergences on this downleg.  This doesn't mean we will not go down more, but if we do, I expect the market to bounce back quickly. 
I expect a couple more days of weakness and then strength starting late next week.  Risk reward favors the long side in July.