I like looking at this index. Once it goes below 70%, there tends to be some type of correction. Before putting any money on a short, I would watch the dollar. The stronger it gets, the weaker the S&P500 gets (at least right now) and vice versa. I'm guessing that if the dollar continues to strengthen after all of the volume in the UUP yesterday (check out the charts below), we will upward resistance in the US Markets.
If that happens, some people will get jitters and move their money out, perhaps into cash or treasuries or something "safe". I don't know how much of a reaction this will all cause (or if we have experienced most of it already), but that is my current mental framework of the market.
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