Stocks suffered their worth loss in over thee months yesterday. What I thought was strong support at 1345 on the ES got taken out by more than 6 points, but this morning the market is trading back up close to 1350. It has been said that concerns over the Greek PSI deal were the catalyst for the selling yesterday. Now following news that the Greek PSI Deal will get done, the market has found some bids and has traded 10 points off yesterday's lows. Greece continues to be old news, but nonetheless, continues to act as a trigger for selling in what is an overbought market. The question now is if the latest decline has any more legs. I think it does, and I see 1331-1332 as a potential next target lower. So the next question is how much of a bounce might we see before the market does continue lower? We are seeing some selling off the 1349 pivot resistance as the market opens. I'd prefer to sell into resistance levels or buy into support than to try and predict which way the market will move from here.
Levels to watch today on the ES:
Resistance above at: 1349-1350, 1354-1355, 1358-1360
Support below at: 1342-1343, 1335-1336, 1331-1332
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