Can Bulls Finally Take Control?

The area they need to clear is...well, clear.

Technical Edge — 

• NYSE Breadth: 62.5% Upside Volume 

• Advance/Decline: 54% Advance 

• VIX: ~$19.25

I want to do something a little different today. Instead of the typical look at the charts, I want to do a more detailed breakdown of yesterday’s action. Because when you zoom in on the price action, it was honestly fascinating and I am hoping that it can help traders navigate the recent action better. 

S&P — SPX

Coming into the day, we were looking at two zones: Either 10-day + 200-day + 50% retrace to hold as support, or the 50-day + 61.8% retrace. In the end, it was the latter — the 50-day and 61.8% retrace — that held as support. 

Above is an intraday look at the SPX index on the 15-min chart. 

Notice how we came down hard off the open and began to consolidate the opening 60 minutes of action (blue box is the H1 range). 

We broke the low, but then bounced back (twice) as the S&P wicked off the lows. From there, the SPX powered up through the session high and ran all the way to yesterday’s low. 

It was rejected initially, but reset at the rising 10-ema and opening-hour high, then powered to new highs and ran to last week’s high. It reset at the 10-ema again in the final 10 minutes for anyone who wanted to take a lotto shot on a bounce into the close.

There’s nothing groundbreaking here. However, I hope it acts as a reminder to keep an open mind when trading. Conviction is important, but so is flexibility. It helped to sell the rallies early, as the S&P struggled for upside. However, it paid better to turn bullish once the price action told us to. 

For me, that was most telling at around 12:30 when the S&P pulled back and held the opening-hour range high + 10-ema. That was a low-risk long opportunity. 

S&P 500 — ES