The markets rallied on positive covid vaccine news (an overreaction). But the price was unable to hold and dropped substantially by the end of the day. with the price not hitting the high for the day at least once after the open.
SPX would likely retest the support at S1 and if that holds we can see another leg up before seeing any downturn.
If S1 doesn't hold then we are looking at Support with the 50day EMA (relatively weak) or a retest to S3. which is where we can find a decent amount of buyers.
The massive gap up today is a result of a short squeeze with investors turning optimistic a vaccine might be finally ready which is clearly not the case since important data about the duration of immunity was not released.
With growing selling pressure (observe the MASSIVE Volume) I am anticipating SPX to fill all the gaps on its way down.
I have cashed out my calls at midday and am holding puts for this week. It's advisable to hedge your positions till the support(S1) is broken.
Thank you for reading.
**Just an opinion.
SPX would likely retest the support at S1 and if that holds we can see another leg up before seeing any downturn.
If S1 doesn't hold then we are looking at Support with the 50day EMA (relatively weak) or a retest to S3. which is where we can find a decent amount of buyers.
The massive gap up today is a result of a short squeeze with investors turning optimistic a vaccine might be finally ready which is clearly not the case since important data about the duration of immunity was not released.
With growing selling pressure (observe the MASSIVE Volume) I am anticipating SPX to fill all the gaps on its way down.
I have cashed out my calls at midday and am holding puts for this week. It's advisable to hedge your positions till the support(S1) is broken.
Thank you for reading.
**Just an opinion.
support zones to watch - 3500 - 3530.
price needs to break that zone for the downtrend to gain momentum,