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Good evening, traders.
We’re still investigating this bull flag on SPX. We broke out above, which turned out to be a false breakout, fell back inside it, attempted to rally above it again on Friday, which got rejected, and we consolidated today:
On Friday, we had a great setup because that sharp reversal on Friday can follow through into Monday, and because of that, I thought there was a good chance we might gap under this trend line:
And though futures were down initially, that overnight weakness didn’t last and we got no continuation of that in the cash today and saw no Monday followthrough. That’s a shame because it seems like a wasted opportunity. The equity put-to-call ratio fell somewhat significantly on Friday, and I think it would have been better to run us down while everyone was caught with their pants down. I’m waiting to see what tonight’s reading will be.
There is of course, a way we can still count this roughly as we had been:
So, we’ll have to see what happens here. I think we’re basically in the same place we were on Friday. There’s still a setup here for lower prices. I’m a little more skeptical of it here today than I was last week, but the door’s not closed on the idea by any means.
I hope everyone has a lovely evening.