Regarding the equity markets, I’m leaning towards this scenario of one more thrust down to put in a divergent low before a substantial rally, targeting /NQ 8961-8890ish support/target zone and/or the /ES 3200 support/target zone.

Essentially, after studying the charts further, I changed my outlook from yesterday’s closing market wrap video in which I stated that the downside from where was closed was likely limited (before a decent rally, whether or not the market moves lower in the coming weeks or months) and in this comment thread late last night, I had posted closing out the /NQ long positions taken shortly before & immediately after the opening bell yesterday which I had reversed from the short position taken home over the weekend & reversing once again back to a short position as I am leaning towards one more thrust down, while posting the first chart below, which is followed by the updated 60-minute charts of /ES & /NQ with my preferred scenarios.

One of the reasons for modifying my trading plan was that /NQ had built on the gains from yesterday’s lows around the 9:30 opening bell while /ES had run into the 3255 resistance level (which is where I reversed with /NQ around 9220 at the time). As such, with the market feeling very heavy all day yesterday (i.e.- it couldn’t catch a half-decent bid as the buyers were nowhere to be found) and the fact that the futures had made a half-decent rally into that resistance level in the late-evening hours, coupled with many other factors, I think the R/R was (and still is, as /ES is still trading just below that 3255 resistance now) favorable for a short position with stops about 1 – 1½% above the 3255 resistance.

One other consideration is the fact that most of the market-leading FAAMG stocks appear to be setting up in potential bear flag continuation patterns when viewing the after-hours & pre-market session trades since the close yesterday. Right or wrong, and I may very well prove to be wrong, I just wanted to share my current outlook for those interested.