Unless tomorrow sees a strong, immediate move up at the open or gap up to recover 426, my thesis has changed. I had been waiting for the trend line or 422 to provide a decent bounce back up to the 430's in order to enter short, but this morning's strong move down has communicated that the fear in the market might be catching up to everything else. The last hope I have for a bounce is where we are right now. The "hype" rally after May has all disappeared and we are now trading at levels that seem more appropriate and consistent with price action.
If the initial leg of this new range is down, I'll be looking at previous support levels below 420 to turn into resistance and enter short on a retest. If we do somehow bounce this week, the first area of resistance would be 426, then the white trend line. The longer we stay below the trend line, the less likely a recovery is.
Tomorrow I'm watching 421.82 and scalping either long above or short below. Today very well may have been a move under support to capitulate early bulls before moving back up. I tend to favor anti-trend swings when the move becomes extended, though the chop at the trend line shows we might have picked up enough liquidity to begin another leg down. We should have a more clear picture as the week progresses. Good luck to all this week and I hope everyone makes money!
IWM right below support
QQQ at support