Introduction
On July 24, the S&P 500 closed at 5,427.13; this marks almost a 5% drop from the previous high. This drop follows a series of mixed performances over the last week. The volatility is attributed to significant losses in major tech stocks and companies within the utilities sector. Notably, shares of Vistra Corp. and GE Vernova dropped significantly due to concerns over energy demands and regulatory uncertainties (Investopedia).
Get out, or buy the dip?
The outlook is a bullish one. Price has retraced into the 50/100 simple moving average zone and if history repeats itself, we should see a bounce soon from here.
Another bullish technical on the chart is the rising trend line on the daily. ES is approaching this line and if we grind down to shorter time frames and look for signs of a reversal, it could be a good long entry. It will require patience however and strict money management rules.
Look at the hourly chart below. We can watch for signs of RSI divergence when we look to entry our long. The volume profile is also showing something interesting, the hammer indicates the lack of volume as the price tanked but it is finding support. If the Point of control moves down to the support zone where price is currently ($5,462) It could be further indication that the short term low is in.
As always, trade with discipline and patience and always think in probabilities.
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