Seven weeks have gone by without a new high, each coaxing more traders into the bear camp. That’s why this distribution has been so tedious: getting short has grown more appealing by the day. The result is that the broad averages have become more diabolically evasive, particularly for those trying to get short. And yet, we knew all along that Mr Market would provide no easy opportunities. Friday’s whimpering climax looked like one, though — at least for anyone bold enough to endure waiting for whatever news hits us on Sunday. My hunch is that anyone who got short at or near Friday’s 7496.50 high will be in good shape. That implies this vehicle is on its way down to at least 7357, where an important low occurred exactly one month ago; and thence to the 7261.75 target of the pattern shown. There will probably be a strong bounce from there, and although it must be shorted, there is no reason to think this will be easy.
$ESM26 – June E-Mini S&P (Last:7444.00)