As posted yesterday, the setup for the SPX and DIA looked mostly bearish. The central daily levels provided of 7,717 for the SPX, 534 for DIA, and 7,730 for the ES=F, were shared to validate the bearish setup if the price stayed below them.
The SPX did open below the central daily level (CDL) that sets momentum. When the price stays below it, the structure favors the bearish thesis, and the opening far below it validated the technical setup. Next, the price lost 7,690 and attempted to fill the daily gap, but momentum vanished quickly, flipping the 7,690 defense level into resistance.
Bearish momentum continued as the price moved to 7,673, another level anticipated yesterday for today’s session. It held as support until it was broken at noon. Afterward, the price closed below 7,646, positioning itself to target 7,610 as price action suggests. All these levels were anticipated yesterday when the market closed.
A similar case happened with the DIA. The price action lost not only 534, but 533 and 531 as well. Over the weekend, I highlighted the DIA as a bearish setup with a high probability of completion. The ETF, mirroring the Dow Jones, has indeed fallen 1.7% this week, exceeding the bearish weekly target of 528.
Because the market is printing significant moves overnight, the central daily level (CDL) for the E-mini S&P futures is now part of this publication along with all its layers, the anticipated level of 7,730 was lost overnight, adding further confirmation for a bearish session today. The price fell, breaking through key levels until finding support at the confluence zone of 7,664 and 7,658.
These levels are highlighted because they were provided in advance of today’s session, proving to be essential zones where institutional algorithms are likely to react. Having them ahead of time allows you to monitor the step-by-step levels down or up to validate momentum, or to spot areas where the price is likely to reverse, always supported by technical analysis that frames the directional expectation. Unlock this tool and all the content at SmartReversals.com:
Last weekend in the Weekly Compass, I anticipated the likelihood of a bearish reversal for the SPX, providing weekly levels to map price action across wider ranges. The price action indeed lost 7,773, and the SPX is currently nearing 7,630, completing a 1.86% weekly move so far.
Today’s Agenda:
Let’s study the levels for tomorrow and analyze the potential downside targets for both the SPX and the ES=F.
Today’s content also includes the combined weekly and daily levels for QQQ, SMH, MU, NVDA, AMD, AVGO, and TSM. As anticipated in the Weekly Compass, these semiconductor giants are playing a crucial role this week.
Let’s begin.