The markets headed lower for the second session in a row, as we have now broken shorter-term support levels. The markets established – and broke out of – a very tight range created over the holiday week. Since Tuesday, the markets have been steadily retracing back down towards their respective lower channels, breaking below the base set last week.
We have seen a decent amount of economic news this week, which could be the primary factor for the increase in volatility. We still have the non-farm payrolls report due out tomorrow, which we expect will add even more volatility.
Technically, this looks more like a bull pullback – still well within an overall sideways range as investors react to economic results. These moves are speculative at best. Without any hard action taken by the Fed, we should continue to treat them as such. Stick to trading range-bound markets until this sideways trend is broken.
Have a great night,
Maverick Trading
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