Don’t Short this Collapse Until You Watch!

Welcome back to the party – are you ready for tomorrow?

Markets collapsed and finished today’s session deep in the red, so I’ll be looking for shorts off key resistance levels above us on Thursday…

But let’s not forget – the last time we saw such bearishness in these markets was just before a massive run higher!  Could tomorrow be the same?

The key is knowing the difference between a pullback and a reversal – I’ll show you an easy shortcut in tonight’s video.  Don’t get short until you watch!

E-Mini S&P (ES):

E-Mini Keys to Success:

Buyers took control of the Emini to start the day, but the bottom fell out of if this afternoon and sellers took price lower with a massive measured-move to finish the day.

Anytime we see such a large move in one day, I always expect a range the following day.  And with such strong bearish momentum we know the best entries will be “shorting the pops” until we see buyers take control of momentum again.

E-Mini Nasdaq (NQ):

Nasdaq Keys to Success:

Buyers took control into a range to start the day on the Nasdaq — but like the Emini, sellers took control and ran price lower on strength down to complete their measured-move.

With so much strength for the bears, we can assume sellers will be waiting to short into any decent bounce off these lows.  If we don’t get the bounce higher, look for a range and focus on selling buyer failures at resistance above it.

Crude Oil Futures (CL):

Crude Oil Keys to Success:

Crude Oil began the day with buyers in control into a range, but sellers took control late-morning and price raced lower leaving an open-loop at the lows.

Just like the Nasdaq and Emini – whenever I see this much strength going lower, I always expect sellers to be looking for ways to short the bounces for a retest of today’s low.

I’m also watching for a range tomorrow – it’s strange that sellers didn’t retest yesterday’s low, which is often a clue there may be a range coming that we don’t see yet.