Bears Back In Control For SPX, Is A Relief Bounce Setting Up? April 27th Plan
After spending the entirety of April stuck in identical repetitive cycle of dip buys (with the typical day featuring an evening/early morning sell into 4140-4130 followed by a rally), ES broke the cycle yesterday, putting in a 1.6% red day, the largest since March 22nd where ES was equivalently red.
The reason for this selloff was technical analysis 101, as ES broke down 3 week long channel structure which I have described all month. As readers know, this triggered shorts yesterday (on the first proper support breakdown in many weeks) and resulted in a nice flush lower to the 4100 and 4088 support cluster, where we spent 20 hours stuck, before a late day flush.
I wrote yesterday: “4120 triggered the sell, and therefore, bulls need to clear that to resume any sort of uptrend, and bears are in control”. Bears certainly controlled today, but is a relief bounce coming? In today’s newsletter, I’ll address this, talk how I navigated today’s complex action via my system (and yesterdays plan), then provide the actionable trade plan for tomorrow.