On what level should we be focusing right now in the S&P 500?
Let’s zoom-in to pinpoint this current pivot level and plan accordingly:
As I’ve been highlighting to members, price has been in a stable trading range between the 2,120/2,130 upper resistance and 2,080 lower support.
Monday’s “Greece is falling apart again!” news triggered a breakdown away from 2,100, shattering 2,080’s support, toward the next downside support target into the rising 200 day Simple Moving Average near 2,055.
Now, we’re seeing a logical and expected rally or bounce “up away from” this key pivot (2,055).
What’s important now?
Simple – 2,080 again which is where sellers rejected an advance through this level today and yesterday.
For objective planning, the market would be short-term breakout bullish above 2,080 and especially 2,085 to target the 2,095/2,100 cluster again.
However, we’re seeing a rejection here and will be cautious or bearish on another movement down away from our pivot into the 2,080/2,085 level.
Here’s a zoomed-in perspective of this development:
I’m highlighting the short-term Fibonacci Retracement grid for you.
As drawn from the spike high to low in late June, the 38.2% Fibonacci Retracement level is near 2,085.
Price fell just shy of this level yesterday morning and fell straight down from it this morning.
Note the “Flag” or rising parallel trendline channel which resembles a “Bear Flag.”
Either way, as we go into and beyond the Fourth of July holiday, focus your attention on 2,085, 2,070, the lower support at 2,055, and of course the upper target (if above 2,085) into 2,095 then 2,100.
Follow along with members of the Afraid to Trade Premium Membership for real-time updates and additional trade planning.
Corey Rosenbloom, CMT
Afraid to Trade.com
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