Broken head and shoulders neck line, extremely oversold.
Just noting that the violence of yesterday and today seems more pronounced than August's sell off. We blew right through the gaps at $291.06 and $288.92. That in itself should tell you this should not be played with. This is the proverbial freight train with no brakes. There strictly aren't any buyers.
BUT with that being said we're extremely oversold on every TF besides the daily, which leads me to believe we could see a short cover rally today, and possibly some more follow through to the $282/200MA level tomorrow. I wouldn't be surprised if we get a backtest of the neckline/trendline at the $290 level. I've been in and out of this the past two days on /ES and have had a net short position in SPY since we got back up to $300. Watch for the non farm payrolls number on friday, but until then there's no brakes on this thing and the negative news everywhere seemingly is adding to the velocity. Watch for the bounce, it will come eventually.
First target is the $274 May low, and second target around the $262 level.
Good luck.
BUT with that being said we're extremely oversold on every TF besides the daily, which leads me to believe we could see a short cover rally today, and possibly some more follow through to the $282/200MA level tomorrow. I wouldn't be surprised if we get a backtest of the neckline/trendline at the $290 level. I've been in and out of this the past two days on /ES and have had a net short position in SPY since we got back up to $300. Watch for the non farm payrolls number on friday, but until then there's no brakes on this thing and the negative news everywhere seemingly is adding to the velocity. Watch for the bounce, it will come eventually.
First target is the $274 May low, and second target around the $262 level.
Good luck.
Trade closed manually:
Just closed my long on this cover rally.
