Impressive Selloff Much Ado about Nothing

Well, that selloff yesterday was something!

But also nothing.

On the hourly chart of the ES, it was a minor correction. The breakdown of the top pattern has a conventional measured move target of 5235, but I’m not sure that will get hit. There are already signs that a 5 day cycle low is in place. In addition, none of the significant uptrend lines from early May have been broken.

In short, bears seem to have more work to do, starting with a failed rally. As of 7:15 AM ET, the ES faces trigger resistance in the 5288-95 area. If that’s cleared, that would be a confirming intraday buy signal. If the market rolls over instead, then we’re likely to see that 5235. There are multiple support lines there. If that were to break down, that would be yooge.

In my swing trade screens of 1348 NYSE and Nadsaq stocks that meet my price and volume criteria, yesterday was also nothing.  As you might expect, there were hardly any stocks that met preliminary buy side criteria, just 11. One of those did trigger a buy signal yesterday. There were only a modest number that met sell side criteria, a total of 88, but oddly, none of them triggered yesterday and only a handful triggered earlier this week. Which makes me a sheptick that this selloff will stick. Low Confidence, Limited Risk, Tilted Buy

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