Post-open Review… Too soon?

Overnight highs retraced to unchanged.

The bearish template for today is a recognition of the rally being intact. This may prove to be a temporary correction, but its series of higher highs and higher lows was maintained through yesterday’s close. Yesterday’s peak met and held the correction’s 2727.75 limit, but it wasn’t rejected by reversing down into the close.

So, reversing down could be done either by rejecting probes above yesterday’s highs, or else already gapping down. Overnight news produced a probe above yesterday’s highs up to 2734.50, which the open retraced — first to 2720.00 and then to 2717.50. The 2727.75 bias-up signal didn’t trigger.

And still the series of higher highs and higher lows remains intact.

More so, the retracement filled the gap back to yesterday’s close. And held it, through the open. That was the time for sellers to have broken under the prior close, or to have delayed testing it at all. Testing it and holding it through a relevant window like the open undermines sellers. In fact, an 11-point bounce just tested 2727.75 as resistance (too late to trigger, or to invalidate that it didn’t trigger).

Even if we knew with 100% certainty an offsetting test of the 2704.75 bias-down signal will be fulfilled today, the path there is not assured. This bounce up to 2727.75 could extend to 2731.00-2732.00. Back under 2723.00 first would start to signal another downleg underway already.