As, posted last week in this post: Bear Impulses Retesting Before Next Drop, and this chart, significant retesting of a the currently in-progress downward BEAR IMPULSES should be expected. We indicated that testing in the 1990 area would be normal/ideal - and preferred between 1950 and 1990. Though it is totally normal for impulses to retest the breakdown point directly, in this case, that is NOT the highest probability outcome and would expect a retest that looks similar to the retest of the upward impulse shown on the chart below, but as stated in last week's post the option of a direct retest of the breakdown must be respected.
We are presently looking for BEARISH RETRACEMENT triggers (Magenta BR Labels) on the Daily and Weekly charts which will likely lead to pronounced weakness and subsequently the dissipation phase of the current Daily and Weekly Impulses.
We had a tremendous week last week in the lounge, with prescient and powerful signals triggering for upside into the NFP report and also, Market Structure Projection, eTickTools and Accumulation Indexes nailing the low on Friday morning in the 9:30 to 10 AM area and at that time suggesting a close near the high of the day as the most probable outcome.
Given the overall setup, IT MUST BE STATED AGAIN for the record, that impulses usually retest and they require more attention that we had received up till Friday last week. Friday was a solid step in the right direction. Interestingly, HAL and RVS systems began triggering initial SHORT risk entries which ideally get additional entries higher - these systems are very reliable and the fact that they prefer to sell this rally is significant.
Also, in last weeks, post, we specifically mentioned that into the first 3 or 4 trading days of this month bullish potentials are probabilistic. This remains the case, however, starting on Tuesday's AM cash market open, forces turn much weaker with Wednesday being particularly so.
Additionally, IT NEEDS TO BE RESTATED, the markets are in BEAR IMPULSES which implies much further downward pressure to come and does not view this retest as bullish. Nor do RVS and HAL, which contend that the bias in the markets is now statistically a BEAR MARKET. According to very long-term Market Structure Projection overall, downward pressure (ofcourse, with strong rallies interspersed) are probable into March/April next year.
In closing, We REMIND ONCE AGAIN AS IN OUR LAST POST, that once the shorter-term charts start generating downward impulses, starting from the very short-term 1, 2, 5 and 15 minute charts, risks for downwards progress increases significantly and that type of activity, shorter-term impulse generating fractals across time frames will certainly be in place when we complete upward structures on the intermediate-term to longer-term cycle charts. This can happen, starting at any time. Complacency in this market is not a good option. While the markets can extend upwards, these are fickle upward impulses can truncate abruptly.