It seems like weeks ago, but SPX captured the first upside target/reversal zone from Monday's update and then reversed hard straight into new lows -- and has since bounced hard as well.
I currently do not have a strong opinion as to where this bounce is ultimately headed. There are some clear resistance zones along the way, any of which could put the kybosh on the rally -- but by the same token, it could run farther and faster than most bears are expecting. The challenge for bears is always "not to give back all the profit they just earned." I suspect when the rally is over, that will be reasonably clear.
There are a lot of different ways to count the decline from the 2800s, which makes calculating the target for this bounce challenging:
INDU found support near the blue support line that's been on this chart for a while:
In conclusion, it's currently speculative as to whether this rally will find legs or not. It may just intend to test one of the prior breakdowns and reverse directly, or it may intend to retrace 50% of the decline (from the all-time highs). We'll take it as it comes. Trade safe.
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