It was clear from the elevated volume overnight yesterday that the market was setting up for a break from balance one way or the other. The total volume on the day was 2m contracts and 4.5bn shares traded on NYSE, a big increase on the average we've seen as longer timeframe likely got involved.
The early rejection of prior value and negative market internals supported a balance breakout to the downside. The attempted break back into the prior range after the initial balance low saw an aggressive short covering rally but this ran out of steam with internals clearly still negative. There was consolidation under the overnight low and then an aggressive liquidation break. After the low was in there was a rally back into the close to settle at 2079.00.
Value was left clearly lower on the day and still imbalanced for further downside in my view unless the market can hold above yesterday's prominent POC at 2088.75, which is back within Tuesday's range. The anomalies in the profile and VPOC at 2079.00 are areas to revisit during RTH. Acceptance under there should see a push lower to test the April 17th swing low at 2064.50.
Overnight has been light in volume with Europe on holiday. The range is 2080.50-2088.00 currently. ISM manufacturing is the main number out this morning at 9am ct, which has been trending lower for the past few months. Prior was 51.5, consensus is for 52.
I'm looking for a move off the 2088.25-89.75 resistance zone back down through yesterday's range. Above that zone there's good potential for a rally back into the 2095.00-96.50 zone before sellers could regain control again.