$ES/$SPY Weak But NVDA Changes That.
A lot to cover tonight. Let's dig in.
Today was a continuation of selling that we saw yesterday when we traded to $4155-$4160 and had a low energy reaction.
The markets are just an auction and each area of price are real-time auctions so when the price gets to an area and is weak then you have clues to the price.
Yesterday was weak. This led me to say this in the post last night about today’s plan.
The second bull case is if we get to $4100-$4115 - that area as well I want to see if I can buy. On the way out of that zone $4130 becomes a spot to break through again.
My concern (and it’s small) is that we need to see a larger reaction from this area. If we trade down into either of these spots and we do not see a 10+ point bounce with high energy then this becomes the start of a sell-off.
So we broke $4130 because that test this morning was in fact weak.
$4115 was a spot for me and we traded exactly to $4114 which held all day.
We rested $4130s, failed, then we ramped back into $4140 are before failing again.
This is distributive selling in the market.
Again, I’m not saying “I told you so” and I know some of you like to get emo but last week I did explain why this ES/SPY made me uneasy on the breakout.
We closed on lows which was bad, but this move after hours from NVDA has changed things quite a bit. I am going to dive into this and the zones/plan tomorrow below.