Following yesterday’s breakouts above the 60-minute downtrend lines on /ES & /NQ (S&P500 and Nasdaq 100 E-mini futures), both have fallen back in the overnight & early morning trading session and are now backtesting those trendlines (support) from above.

This can be viewed & acted on in one of two ways: The bearish case would be that yesterday’s breakouts have failed, which makes them a ‘bull trap’, with the indexes likely to continue lower today, quite possibly below yesterday’s lows & beyond. As such, those that believe that is the most likely scenario could short /NQ or /ES here with a stop somewhat above.

On the flip side, the bullish case would view this backtest of those trendlines as another objective long entry, should the futures bounce off these trendlines (former resistance once broken becomes support), with a stop not too far below. Should the futures make a successful backtest & bounce off these trendlines, the initial & minimum target for /ES would be the 2750ish resistance level & the 6989.50ish level for /NQ.