Hell of a week, eh folks? Being patient with this range the past month has been challenging, but we knew that sooner or later it would eventually break.
I was fairly doubtful that we would break to the upside, but I learned my lesson in the first quarter of this year, that no matter how bad things look or feel, you have to HAVE TO wait for a support level to break before getting committed to the downside.
For me, SPX 1325 was that level to watch. I closed a few shorts that day as a precaution, after all, I could always get short again if the level broke. Now that we have in fact broken upwards, it appears my observation last month is still in play.
To summarize, I was expecting a 50-61.2% retracement (small blue box) followed by a return to the Mar/April highs. You can read it here if you want a reminder.