The by-the-numbers follow-through yesterday to Wednesday’s A-B decline came within two ticks of an obvious D target at 1397.50. This number was flagged during the impromptu online session, although not with any great enthusiasm. The support lacked appeal not only for its obviousness, but also because it roughly coincided with some lows from last week. There are a bunch more to the left of them that go back to August 3, but my gut feeling is that sellers will breach all of them today, creating an impressive bearish impulse leg that is a logical consequence of Tuesday’s nasty bull trap. If the week ends with a selloff is as steep as Thursday’s, it would test the support of a midpoint pivot at 1393.00, and if any lower, at D=1383.00. This being a Friday, trading these two numbers (and that’s assuming C=1403.00 survives) will have to be catch-as-catch-can.
