Post-open Review… They missed.
“When you strike at a king, you must kill him.”
Gapping down to and/or through Friday’s low would have begun rejecting its breakout.By the same token — it’s flip-side, actually — coming that close without succeeding would only trap shorts. And squeezing them could succeed where Monday had failed, fueling the rally’s resumption.
The pre-open low was probed by 1 tick down to 1995.50. An interim bounce to 2000.50 was reversed to a fresh low at 1995.00. All that volatility and lower lows, yet the 1998.50 bias-down target was still being overlapped at 10:15.
So, the bias-down signal was not renewed. It also wasn’t rejected in time to signal a recovery yet underway. Meanwhile, fresh lows had room down to 1993.50, albeit likely to recover.
The fresh lows were prevented by a surge attacking 2003.00. Its timing is no more credible than probing fresh lows — either is likely to be retraced. In fact, the surge has reacted down to 2000.00.
Back under 1998.50 would suggest 1993.50 is back-in play. Testing it at this stage (rejecting the interim surge) would be a little less likely to recover. Exiting the bias environment at 11:30 back above its 2004.00 bias-down signal would instead confirm that trapped shorts are fueling a recovery back to 2010.00-2012.00.