The caution going into yesterday was whether or not a move back to the CHVN at 2728.00 would either find support or fail and potentially trigger a liquidation move. The eventual break of the prior day’s low on the second attempt (after bouncing to the vpoc on the first try), really accelerated the move, dropping about 40 points in the last hour.

Overnight so far the range is 2658.75-92.50 versus settle at 64.25. The overnight high is at an important area for bulls to push through if there’s going to be any chance of a reversal. Failing to break that could leave the market balancing in the lower half of yesterday’s range or try to extend lower. The after market earnings today from AMZN & GOOG and how the Nasdaq responds ahead of that are going to be hugely influential later in the day particularly.

My main expectation is for some consolidation in the bottom half of yesterday’s range with an attempt to test the lows. A failed breakdown could lead to a very aggressive short covering rally, as could a hold above the overnight high could target the 2728.00 CHVN. Any breaks lower are going to need broad market participation and momentum to be sustained.

Zones of interest today: