The market sold-off hard on Thursday erasing all the gains from the last 2 pullback-up days, including Wednesday's Fed engineered rally.
Led by the Tech stocks NQ erased all the 2 day's of gain and a little bit more in just one day as NQ tanked over 124 points on Thursday.
After breaking below Wednesday's swing low (support), and then successfully re-tested the broken support - turned resistance -- Wednesday's swing low, a new rounds of algorithm sell programs hit the market, tanking the market hard.
After breaking below Wednesday's swing low (support), and then successfully re-tested the broken support - turned resistance -- Wednesday's swing low, a new rounds of algorithm sell programs hit the market, tanking the market hard.
NQ would now needs to break-back above Thursday's swing high to reverse the downtrend. For now, the market is in crash mode.
Key inflection price level for NQ in Friday is 3500, and for ES is 1834.
-- Failure to break-back above inflection price level implies the market is still in fast mode down, next support for NQ is 3400, for ES is 1786.
-- Above inflection price level implies the market is in a pullback-up mode / consolidation mode with key resistance at 3540 for NQ and 1844 for ES.
With so much leverage in the market, it should not surprise anyone if the stock market crashes, and with the market now being mostly controlled by algorithm, and not by human, it can tank harder than the crash of 1987, see the chart of the 1987 stock market crash below.
