Home > Commodities and Rates, Short-Term Trader > Markets Getting Dicey – Retest Or New Leg Lower?

Markets Getting Dicey – Retest Or New Leg Lower?

S&P 500 Futures

The S&P futures are currently in 'gap-fill mode'. It seems likely that by sometime tomorrow the 26 handle void created last week will be filled. We closed just 8 handles shy of that level today. I still believe last Tuesday's low has a chance of holding, however; due to this morning's failure of last week's bullish pattern, I am not dismissing the notion that another leg lower will unfold.

The failure of the Inverted-head-and-shoulders-pattern  has put me back into quick-hitter mode, taking trades from both sides of the tape will be the name of the game until further notice. Vol is high so markets are offering plenty of opportunity for those who are quick on their feet.

If the ES can't hold between 1061 (Gap fill) and 1036 (Tuesday's low) the next significant level of support lies at 1015. Should a break of last week's low take place, the next critical support zone in the S&P 500 Cash Index comes in between 1020-1030.


Upon taking a look at the Euro you will see a descending triangle which should trigger sometime in the next 24 hours. I still remain in the bull camp at the moment, however; if the triangle triggers to the downside then exiting long positions and consideration for a putting on a short will be warranted. A measured move, based on the width of the triangle, indicates the possibility of a sizable 500 pip move in either direction.


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