What Happened: Alongside worries over the economic impact of a resurgent pandemic, U.S. index futures auctioned lower overnight.
What Does It Mean: During Thursday’s regular trading, buyers responded to lower prices, at the high-volume node near $3,667.75, a price level where the auction spent a lot of time in the past.
The session ended inside of prior balance and range denoting acceptance of the lower prices.
What To Expect: In light of yesterday’s price acceptance and the overnight gap lower, the following frameworks apply for today’s trade.
In the best case, the auction makes an attempt to repair some of the poor overnight structure. Thereafter, buyers regain conviction and initiate through the $3,642.75 balance-area boundary, ending the downtrend. This scenarios would put in play the high-volume node at $3,667.75.
In the worst case, if the S&P 500 auctions below $3,630.00, participants would look to whether the $3,592.25 balance-boundary offers a response. If not, the higher-time frame breakout is put into question.
Levels Of Interest: $3,642.75 and $3,592.25 balance-area boundary, as well as the $3,667.75 and $3,630.00 high-volume nodes.
Bonus: The higher-time frame breakout remains intact and selling appears measured. Still, the rally is on hold; monitor for continuation.