Mid-day Update… Template X

Position of strength invalidated.

Closing yesterday above the morning’s 2721.00-2723.25 highs had indicated the overnight and morning’s sponsorship was done. Not that the pattern would allow yet for a durable bottom, but a corrective bounce was likely.

Other factors had made the first reaction likely to be down, and then the rally could resume. Backing-and-filling held its earliest possible target and recovered enough in-time to get a benefit of the doubt. But the decline has only persisted since.

Actually, the lowest potential pullback target at 2701.50 is being tested now. And RSIs are essentially diverging positively. It’s still a bias-down environment, but rally could emerge.

Otherwise, the invalidation template will be winning out. A much more substantial downleg compared to Tuesday would be underway. And the decline from recent highs will have resumed.