After a nearly straight 488 point rally, the inevitable happened today and we finally got a pullback. As I wrote two days ago: “A few things are clear: Moves like this unwind fast and hard. The reversal will probably come on some headline (something like Russia/Ukraine peace talks failing), likely be at a major resistance level, and probably see a 50-100 point drop rapidly”.
While I was hoping ES could pop 1 level higher before getting the selloff, the energy simply was not there and ES could not reclaim 4595-4600 today to trigger longs. In addition, ES also lost a fairly critical support level into the close, which complicates the bull case and tells me we probably aren’t quite done on downside yet. What the 1st bounce looks like will be key for determining what the path going forward is. Here’s how I am looking to trade tomorrow which should see some big moves