REVIEW
Let's highlight the SPX (proxy: SPY) break of the April trendline—this is a notable technical shift. Here’s how I see the setup:
Bearish Case: Trendline Break & Downside Targets
- The April trendline break is a clear “character change,” signaling that the relentless uptrend is losing steam.
- The /ES Daily CISD (Close-Inside-Day) pattern and persistent bearish divergence in /NQ (Nasdaq futures) add weight to the downside argument.
- If SPX/ES breaks below today’s low (6885), momentum traders and systematic funds may accelerate selling, targeting the 6800–6750 zone, which lines up with prior support and volume shelves.
- A weekly close below 6770 would be a strong technical confirmation that a top is in, likely triggering further de-risking.
Bullish Alternate Path: Holding the Lows
- If SPX holds above today’s 6885 low, there’s still a window for a final push toward 7000, especially if macro data or earnings surprise to the upside.
- This would likely be a “last gasp” rally, potentially driven by short covering or a squeeze in high-beta names, but the risk/reward for new longs is less attractive after the trendline break.
My Take
- The technicals now favor caution: the trendline break, bearish divergences, and failed retests all point to a shift in market character.
- If 6885 fails, I’d expect a quick move to 6800–6750. If that holds, a bounce to 7000 is possible, but I’d treat it as a selling opportunity, not a new uptrend.
- Watch for confirmation on the weekly close—below 6770 is a major red flag for bulls.
0
0 comments
REVIEW
skool.com/tge-free-4382
A community for serious traders who want to learn how to be profitable trading stocks/options
Leaderboard (30-day)
1
+28
2
+8
3
+7
4
+4
5
+3
Powered by