US indices had another wide ranging down day overnight and the market continues to confirm the analysis presented here. It is all getting very real. I have a lot to get through before the open so I will keep this post brief with more to come this afternoon.
We have seen 2 wide range days down in the S&P 500 from recent high and I anticipate a short term trading bottom/capitulation low tonight. Markets often turn after a 3 day move from high to low. Key areas to watch are 1245/1250 and 1240 futures where there is a confluence of support and relationships. I am sure there are many technicians now who are now calling for a confirmed H+S top and iii of 3 down etc which makes this ripe for a capitulation low. From here, I am looking for a short term bounce back up to 1280s and this is another great area to add to shorts. This is short term trading only, the bigger picture is not good.
I have been stressing many bearish patterns and distribution profiles across markets. S&P distribution, Nasdaq Megaphone/Triple Top, Shanghai breakdown, ASX200 triangle breakdown, Copper bearish reversal candle, AUD double top etc etc. This continues to play out and it has become increasingly likely that a major high is in (short term bounce aside). I thought the market was following the 07 profile and unfortunately I put this aside 2 days before the high. The similarities look eerie to me.
S&P500 Daily 07
Note that a genuine turn out of the low only began with 2 strong hammers and after real panic. Look for this before getting long for a longer swing.
S&P500 Daily Current
ASX200 Daily:
ASX200 we have been in a volatile range from 4450 to 4650 over the last month or so and this will be broken today. We have minor supports at 4315 first thing today but I think we are more likely to see a thrust down to 4200/4250 in the coming days. No need to step in front of this yet given the breakdown of the recent range.
