Sunday Prep 9/19 - $SPY/$ES Don't Think It's Time to PANIC

CME_MINI_DL:ES1!   S&P 500 E-mini Futures
Last week we saw quite a bit of heaviness to the market. Last Sunday Prep called for pops back into the underside of the 20d to be treated as possible areas of resistance where we could look to get short. As you can see we breached this trendline that we’ve been holding since last year. I still don’t think it’s time to panic as there are still plenty of levels below us that I think offer really strong support. The first level is that 4364 level that was the base from late July thru August. Just below that is the previous month’s pivot as well as the August low at 4347.

Remember, we haven’t broken the previous month’s lows for over a year now. If we were to lose August’s lows, that would be a definite red flag for me and I would begin to monitor pops back into levels to see if sellers really start taking control.

The weekly chart really becomes important to me in times like this. From this point forward, I am watching the pushes up to see if we can get above last week’s highs but fail to ever make new ATHs. IF that were to happen, then we may be putting in a lower high on the weekly chart and at that point, the break of the recent lows would validate that lower high and I would start to move most of my long term stuff into cash. The weekly 20sma would be the first real level of support if that scenario were to play out.

As far as levels of resistance, I would still watch all pops back into the underside of the 20d as well as the 4500 level. I personally would love to see a retest of the quarterly pivot at 4512.25 since that lines up real nice with our major breakdown area. A test of that level that stuffs would give you the lower high on the weekly chart that we were just discussing.

But keep in mind that after this large pullback last week, the early part of this week may be a relief bounce and there are plenty of charts that have pulled back to support. So there are still long opportunities in the market, especially if we are going to push off last week’s lows.


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