The SP broke out from balance overnight, rejected value, tested the swing low at 1385 and closed below the 1390 lower bracket limit.
After the first 90 minutes of the day session the market had difficulty moving lower, reflected by the b shape profile and the pronounced mode at 1393. (See ‘Noon look’)
The breakout from balance should signal the start of a new trend, however if Wednesday’s action lacks conviction / volume, the 1393 area can become a magnet.
SRS
(n.b. The SP broke from a 7-day balance, closed near its low and there was no buying tail. However, it should be pointed out that Dalton states that the b shape profile is generally caused by longs selling their inventory to longer-term buyers, rather than new shorts. Consistent shorting would have resulted in an elongated profile - a trend day.)
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