The Bear Market is Back in ES: June 14th Plan
This year, ES tried twice to enter formal “bear market territory” defined as 20% off the all time highs. The 1st was May 12th where it hit the precise 20% down point then recovered, then the second was May 20th where ES entered a bear market then exited the same day. Today, it stuck though, with 3850-60 being the official bear market level and closing significantly below.
What does this mean historically in terms of forward returns? Not much, as I’ll get into today, but there is no doubt that significant technical damage has been done. As of today’s close, we did arrive at my downside target zone which was the 3735-20 area but there is plenty of room below here if bulls can’t make something happen.
In today’s newsletter, I’ll be discussing the short squeeze phenomena, what the short squeeze triggers I’m watching are, as well the 3 core downside supports I’m looking at for tradeable bounces. With major volatility + FOMC Wednesday, this is about as complex as trading gets.