Multi-Month Support Failure In SPX, Is The Uptrend In Danger? Dec 16 Plan
Fireworks were promised this week with the very rare combination of CPI, FOMC, and Quad Witching tomorrow, and so far ES has certainly delivered with a massive 270 point weekly range so far. While yesterdays FOMC was a mostly non-event technically (ending slightly down), I wrote yesterday that “The day after FOMC is also fairly decisive as it shows how the market digests the FOMC day.”
Decisive it was, and to the downside. As readers know, for multiple weeks I had been talking about the importance of a couple levels: 4000, and 3960. Since the 280 point squeeze triggered by the November 10th FOMC, ES has spent since then building a base above the ~3960 level; testing it 5+ times and staging multiple 100+ rallies off it. Today, it failed, and in doing so also lost a key uptrend channel (orange below).
In yesterdays newsletter I wrote how the bear case begins below 4000, at it certainly began as a result of the above failures. The question is now what? In todays newsletter, I’ll be talking the big picture pattern, my approach to counter-trending, and the actionable plan for tomorrow