The gap lower on the RTH open saw a continuation drive towards the recent range HVN as discussed yesterday. Rejection of higher prices has been clear for the past two sessions with the selling tails in the first half hour period. Volume picked up with over 1.8m contracts trading with the liquidation break.
There was negative momentum from the outset and we didn't see any response at the initial support zone. Once the 64.50 HVN had been tested there was a shift in momentum not long after and the support was found leading to a squeeze on shorts into the close.
The daily 24hr chart below shows the HVN test and as long as the market can remain above there, I would expect a recovery and closing of the open gap above. However, should the market trade through yesterday's low and take out last week's low, there is an area of weak structure from around 2241-2208.
Overnight has ranged between 2268.00-76.75 versus settlement at 2276.00. I have initial support at 66.25-69.00 and would want to see that zone hold to initiate longs or I think we may not have seen the end of the short term downside. A break above initial resistance at 74.50-77.00 puts pressure on shorts and there's potential for a squeeze rally into the zones above depending on volume/momentum etc. Broken support becomes resistance and vice versa. With the FOMC meeting starting today and not announcing until tomorrow there may be a lack of continued directional moves if there is a break either way.
Zones for today are below on the 30 min and renko charts.