Post-open Review… Uncle.

Has the follow-through finished?

Selling resumed before the open and retested the 2831.00 overnight low down to 2828.75. Bouncing through the open overlapped 2837.50 resistance by a couple of points before reversing back under its 2836.50 sell signal. The drop soon accelerated into the setup’s 2827.75 target.

And soon broken. By a lot. Sawing through 2827.75 formed a Falling Wedge that resolved down aggressively again, plunging to 2818.50.

That was potentially stage-3 of a 6-stage pattern that often follows (see the nearby chart). Troughing and bouncing back into the Wedge have taken the pattern to its final stage. The bounce extended back above the Wedge before pausing, increasing the potential for its reversal to gain traction throughout the day.

A scapegoat has been identified in the pre-open news of a Buffet/Bezos/Dimon health care initiative that is pressuring the rest of the sector downward. This helps market participants to discount the negative and to start re-focusing on the positive. Not immediately, but gradually and ultimately.

Back under 2827.00 (just tested by a blip-down) would start to signal the recovery is failing. And potentially that a much more substantial intraday drop is forming. Otherwise, could today’s session turn positive? That’s the stuff of blow-off tops, even after their first warning shot is fired. Back above 2831.75 (now being probed) would help to extend the bounce, or more.