The SPX opened this morning gap down for the second consecutive day.
We actually broke down below the bottom of the downtrending channel ST-S1, but that move is just noise. Intraday charts are far from perfect in terms of acting technically normal around support/resistance. The fact that the break occurred on the open further indicates its lack of importance. Buyers and sellers line up on both sides before the open. Where that battle ends up is where trading begins, the open. Since that number is largely unknown it makes logical sense that there would be some extra noise there.
Two opening gaps in a row tells me,
that there's a little panic going on as people lock in some profits, put on some hedges and speculative shorts near, but actually still quite a bit below important resistance R1 There was a lot of negative pre-open banking news and of course George Soros stated that the rally is "unsustainable", likely because it's going against Mr. "I'm having a very good crisis".
So after rechecking the chart it appears ST-S1 is being taken out right now (11:12a mountain).
In any case, I think the gap below is going to fill soon. If the channel fails now I'd expect a drop of the channel width which overshoots lower than the gap. We'll probably get a bounce off the level of the gap as there should be buyers there. But I think we'll probably see a test of ST-S3. I'm still looking to go long with end-of-day accounts not managed by mechanical methods but won't make that call until 1:30p (mountain) or so. I'll post here around then in any case.
