ES has another wave down to go before we can consider the red channel fleshed out. It reached our target zone, but a little faster than expected.
And, it looks further along in doing so than SPX.
Yet, the rising red channel continues to show plenty of downside potential if TPTB should decide to allow it.
Key price levels are 1752.50 for SPX and 1749.33 for ES. If those don’t hold, there’s potential for more downside — an intra-day overshoot of the channel bottom or a new channel as discussed yesterday afternoon.
I’m going to take a few minutes and update the bond outlook, as there are some interesting developments taking place there.