From last week’s newsletter:
“396.60 is immediately below, a fib level and also where the 50SMA sits. It’s possible for us to see some tight range action here between 396.60 and 406.67 until we can manage a close below 396.60 or above 406.61 (keep in mind the 407.22 DP sell level).”
Mentioned yesterday we needed to close SPY 0.00%↑ below 396.60 and open below for the next move down and we got that today. This resulted in a swift rejection at 396.60 and a retracement back to the 200SMA at 393.14.
Now we need to watch out for a familiar pattern that typically develops in these moves, a double bottom/2B scenario. See below:
The next significant orderflow level below is at 387.66-390.59. We would likely see this tested on a move below the 200SMA at 393.14. As this level has now been tested twice and held, it’s significantly weaker if there is a 3rd attempt. More on this on the levels later.
Economic calendar for tomorrow:
And here are the levels to watch tomorrow:
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