So far today, in one fell swoop, SPY has backfilled two of the four recent gaps, taking care of unfinished business, or at least half of it so far. With the RSI on the 60-minute time frame just kissing a rarely seen deeply oversold reading of 20 (same level it bottomed at back on May 13th, followed by a 16½% rally in the broad market from there), the odds for at least a snapback rally start to rise substantially with each tick lower at this time. However, I suspect that any intraday reversal today or early tomorrow will be sold into with SPY continuing down to at least the next gap support around 300.65 (top of gap) to 295.63ish (bottom) before any substantial counter-trend rally.
SPY 60m June 11th
/ES (S&P 500 futures) is currently testing the 3033 support while deeply oversold on the 60-minute time frame although the sell signals on the daily chart appear so blatantly obvious that more downside before a substantial bounce is certainly possible as that is what happens during a crowded rush for the exits. Regardless, the R/R for adding new short positions at this point are much less favorable than earlier today when the sell signals were triggered on the gaps below the daily trendlines.
ES 60m June 11th
/NQ has made a brief momentum-fueled overshoot of the 9740 support with a more downside to at these next two targets whether on not /NQ bounces first or not. We could see a bounce back towards the 9800ish level before the next thrust down to 9650 & quite possibly 9600. However, with the powerful & clear sell signals & other recent bearish developments on the more significant daily time frames, including but not limited to the oversold readings, we may just as likely get another wave of selling in the final hours of trading today before any meaningful bounce. Typical swing traders that shorted on the breakdowns earlier today shouldn’t be overly concerned with trying to game counter-trend rallies other than strategically adding to a partial short position objectively on bounces back to resistance.
NQ 60m June 11th
/RTY (Russell 2000 Small-cap futures) hasn’t looked back since the sell signals that triggered following the divergent high on the impulsive break below the 60-minute bearish rising wedge pattern followed by an additional sell signal on the impulsive break below the 1498 support. 1355.50ish is my minimum near-term downside target whether the small-caps manage a counter-trend rally first or not.
RTY 60m June 11th
Bottom line: We have some pretty solid sell signals on the major stock indices, including QQQ which went on to make an impulsive breakdown below the uptrend line it was testing during the video earlier today. This market has pulled several rabbits out of its hat with numerous stick saves as well as whipsaw sell signals over the past month or so. As such, we will have to assess the charts one day at a time but as of now, today’s price action is clearly bearish with not just near-term implications, but the potential to mark a significant inflection point in the market.