Some days things happen so fast after the open that by the time I get my post up much of the post is already out of date. This is one of those days. On the charts below I outlined a possible bull scenario and assigned it a possibly overgenerous 25% probability weighting. That is a lot lower now as the overnight rally failed hard at the ES weekly pivot at 1909, which was the key support level I gave on ES yesterday morning.
On the plus side I shorted the obvious resistance at 1909 ES and my runner from that trade is currently +33 or so, so I'll keep my grumbling to a minimum.
On the bear scenario the rising wedge rally from the 1812 low broke down yesterday after an ideal 50% fib retracement of the falling megaphone from 2081, and as that rising wedge was a bear flag on the bigger picture. the alternate targets for the bear flag are either a retest of the 1812 January low, or the full flag target in the 1690 area. The high this morning was a perfect retest and hard fail at broken rising wedge / flag support. SPX 60min chart:
The high this morning was at the retest of the 1909 weekly pivot that was key support yesterday and that was a very impressive rejection there. That said I do have a possible H&S neckline for a reversal pattern here in an ideal 1870-5 area, and if a bull can be located that is willing to buy something this morning, I had pencilled in a possible rally from here with an ideal high at that weekly pivot area, so it's still possible with the current low for the day at 1865 that we could see that bounce today. ES Mar 60min chart:
Today is a cycle trend day, which means that there are 70% odds that the day will be dominated by either buyers or sellers. The sellers have made an impressive start and unless bulls can rally back over the 1890 SPX area my working assumption is that the market will trend down today. If bulls can rally back over there then the ideal right shoulder high on the possible H&S that would be forming would be in the 1915 area.
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