Today’s rally on $ES was important from a technical point of view because it was followed by a lower low. The structure of this matters (on my interpretation) because it can be interpreted as an incomplete correction. Today’s rally serves as a “connector” between two legs of a correction (in the bullish case) and we wouldn’t typically expect the first leg—which lasted several days—to be followed by a second leg that lasted only a few hours.
What this may lead us to expect is (again, in the bullish case) a further test of lower prices in which the second leg down is more commensurate in both time and price with the first leg. That would put us somewhere in or around the orange box, and that fits nicely with the wedge we’re in.
The bearish case then has a window of opportunity: if in the process of heading down there, the selling begets more intensive selling, the whole structure can quickly turn into an outright impulse wave casting us out of the red wedge altogether.
To a predator, the scent of blood can be arousing.
[Update: I have filed this under as a win since we did, in fact, get to the orange box as predicted.]