The base case interpretation of a primary degree trend change at the April high in U.S. stocks (i.e. the end of this sharp bear market rally) has so far been borne out by
[First and Foremost] price actions - a decisive initial selloff which was also accompanied by a mini-crash (SP500 down 12.63% from 4/26High to 5/6Low); a sharp rebound (SP500 up 10.11% from 5/6Low to 5/13High) that has been swiftly rejected (SP500 down 4.04% from 5/13High to 5/14Low).
[Second] a surge in volatility – Since the market top on April 26th, actual SP500 volatility has been in excess of 2% per day (or 32% per year) and option implied volatility (i.e. one measure of risk premium) has doubled.
[Third] a worsening market and social sentiment in response to the Euro crisis at hand and to the sovereign debt schemes at large.
[Fourth] a growing list of world stock market indices that have violated their Feb 2010 lows.
Nevertheless, I’ve kept an eye on the alternative scenario of a moderate new high for the U.S. stock market on technical grounds and on government policies out of a double-down/triple-down/all-in mentality - see Topped, Diverging Tops, or a Correction (4/30/10) and A Primary Degree Top (5/7/10). Primarily,
 From a wave structure perspective, the best structures that mark the Apr 26 high as the end of the bear market rally are a zigzag-(x)-zigzag-(x)-flat OR a double-three-(x)-double-three-(x)-double-three , with wave B of the flat or the final (x) wave ending in Feb 2010 respectively. Chart 1 and Chart 2 present the wave count for each structure in SPX since the February low.
However, one has to assume an expanding diagonal triangle (which is supposed to be rare) in Chart 1, and a small B wave (compared to prior B waves since March 2009) in Chart 2. These assumptions do not violate EWP rules and guidelines but do justify for a second look.
 There exists a valid (complex) double three structure which call for a moderate new high to conclude the bear market rally (Chart 3 and Chart 4).
 The market will go where it wants to go eventually, despite government policies out of a double-down/triple-down/all-in mentality. The margin call and multiple margin calls will come. The first one is often the most difficult to time.
The above scenarios present potential traps for both bulls and bears. Near term, index prices have also come to levels that present potential traps for both bulls and bears.
For the dip buyers, the investment landscape may have already materially changed. The mini-crash low of 1065.79 (May 6) and the orthodox low of 1094.15(May 7) and perhaps Friday’s low of 1126.14 are critical. If the top is indeed in, the more forceful wave 3-down of (1)-down is directly ahead.
The bears need to leave some room for one more leg of wave 2 rebound since the mini-crash low. In other words, it’s possible that wave [a] of 2-up is complete, wave [b] of 2-up may be complete at Friday’s low and wave [c] of 2-up could retest the same trend line as illustrated in Chart 5.
Appendix - short term charts