Morning Update for Subscribers
Gap Down + Breakdown = Bearish Momentum Continues
📢 Morning Update for Subscribers
🔍 Gap Down + Breakdown = Bearish Momentum Continues
📊 Market Overview & Open Pivots
🔹 $ES Open Pivot: 5568
🔹 $NQ Open Pivot: 19196
We’re kicking off the week with a major overnight gap down, continuing last week’s sharp decline. $NQ has already printed fresh 2025 lows after a 1000+ point bounce, and $ES is threatening to do the same after its 300pt rally off the lows.
We’ve been ahead of this move — shorting right at the top of the bounce — and now we’re seeing that trade begin to pay off. With the Open Pivots well above current price, the bearish pressure remains dominant.
📌 Educational Insight: Why Markets Move in Waves
Markets don’t move in straight lines. Every downtrend has rallies (short-covering, bargain hunting), and every uptrend has pullbacks (profit-taking, hesitation). These "counter-moves" are essential fuel for trends to develop and extend.
➡️ Think of it this way:
To go down, the market first has to go up (so new sellers can come in).
To go up, it first has to go down (so buyers can step in at better prices).
When one side dominates over time, that’s when trends emerge. Right now, the sellers are in control, and every bounce is being sold — confirming the trend is down.
🎯 Key Resistance Zones
These are the levels buyers must reclaim to have a shot at a bounce or reversal:
🔸 $ES 5595 – First line in the sand for bulls.
🔸 $NQ 19270 – Must reclaim and hold to break the sell pressure.
📉 Key Breakdown Levels
These are zones below which the market can unravel quickly:
🔻 $ES 5575 – Below this = open door to a major sell-off.
🔻 $NQ 19100 → 18900 → 18300 – Watch for acceleration under each level.
These are not predictions — they’re risk thresholds. If price lives under them, the path of least resistance is lower. That’s the essence of trend-following: let the market confirm direction and follow along.
📌 Today’s Scenarios
✅ Scenario 1 – Controlled Bounce (Countertrend Relief)
Price tries to recover to 5595 / 19270
If it stalls there → good area to re-engage shorts
If it breaks and holds above → we could see a squeeze toward 5630 / 19550
✅ Scenario 2 – Breakdown & Flush
Holding under 5575 / 19196 = major warning sign
Below this = look out below, potential 150-170pt range day
Watch for a snap to 5535 / 18870 or even lower
📌 Final Thoughts
Momentum is firmly on the side of the bears, and we’re seeing that play out in textbook fashion.
Any rally is suspect unless buyers reclaim major resistance zones.
Use short-cover rallies to your advantage, and don’t chase moves without confirmation.
Protect your gains, especially early in the week.
Stay sharp and stay disciplined — this is prime market terrain for tactical traders who follow structure and levels. 💪