Has a new market rally started?

Markets have rallied well off the lows in the last few days.  Even though we didn't quite stop at the 9500 mark for the DOW, if you look at the chart with the triangle formation I posted earlier, you will see that we approximately got a bounce from the bottom.  So now what?  The markets have been strong last day or two.  And are showing a bullish bias today (so far) as well.    I was looking at the weekly chart of the DOW and what struck me is that we could be in the beginning stage of the right shoulder formation of a head and shoulders pattern.  If that pattern does form, we could go as high as 10,900 and then back down to the test the neckline.  It might take the market a little while to do so.  I am going to have to stay out (except for dabbling here and there :-)  and see what transpires. 

On the other hand, looking at the daily chart, we are approaching a test of the downtrend line around 10400.  We'll have to wait and see how the chips fall. 

Update:  To highlight the importance of limiting your losses, I will share my latest losses with you.  As you are aware, I sold all my positions except one (BCSI).  While I was on vacation, some news hit and the stock plummeted.  I am now staring at a 35% loss instead of the 8% loss I should have taken (Actually, if I had sold it when I sold the rest of my portfolio, I would have netted a profit, or at worst, broke even if I had delayed the sale).  BCSI is a company with the history of strong earnings and growth.  However, this shows that no stock is immune for a pullback during a market pullback.  We used to have a saying in the good old days of the late 90s.  In the event of a market decline, even Dell will fall eventually.