ES - watching the Feb low neckline

I've been hoping somehow my primary bear scenario might play out with a rally to 1150 before SPX made the next move down towards 870, but it is becoming increasingly clear that it simply isn't going to happen. After reaching an obvious point for a low on Friday morning, the bounce on Friday afternoon was very weak and we just traded sideways yesterday. Overnight the range support level was broken very decisively and a test of the next main support level at 1048 ES in the near future looks likely.

If 1048 ES breaks again, and I think that now looks more than likely, then the way will be open for the February and May lows to be retested in the 1033 ES area, and it that level breaks then we will be starting what I believe will the main event of the bear action this summer, with a fall to the very important support level at 870.

I was expecting a bit more work to be done on the right shoulder of the huge head and shoulders pattern on SPX, but we came close enough I think, and the other two bear patterns on the SPX daily chart, the rising wedge and the right-angled and ascending broadening formations, are already sufficiently complete. The target of 870, as well as being a viable target for all three patterns, was also such a key support/resistance area in late 2008 and early 2009 that if we get close to it, it should exert a degree of magnetic pull for a test of that level:

Having said all of this we may well bounce initially today. EURUSD hit a significant support level overnight & the RSI on the hourly chart hit a major low:

GBPUSD continues rising in a strong channel, though it might retrace a bit today after hitting the top of the channel again yesterday:

I read an argument that the only major hard currencies in the world today were gold, silver, the Canadian and Singapore Dollars and the Swiss Franc, and I would agree with all of those and also agree that USD, EUR and JPY are all, on current policies, on the road to ruin. GBP was too, but the last spendthrift and incompetent socialist government is a receding memory and the new coalition government seems determined to steer the UK back onto a sustainable economic and fiscal course over the next few years.

If equities plunge hard over the summer then GBPUSD may well test long term support again in the 1.40 area. After that I'm thinking that GBPUSD might start looking attractive as a longer term hold, and UK gilts will start to look a considerably better bet than US treasuries.