US30 Last Call for the New York Session: On the Hourly that is in Bearish (directional) Market Bias, a very tall Inside Day formed, which means no true direction and a market pause. Price action can consolidate within the pattern until a true (not false) breakout from either the pattern's high of 42,370 or low of 42,057.
So far, the last two candles have rejected the Swing Low of 42,047 for the bulls to do a shallow or proper retracement to 42,413, based on Mean Reversion.
US30 What's Below? There are 9 Swing Lows and 3 S&R Zones that the bears can potentially breach. That's a lot to "sweep" away old Support Areas that have not been breached in the past. It would be a cleanup job.
Each time the bears do a candle close to breach a Swing Low, then more moves to the downside, reinforcing the Bearish (directional) Market Bias.
US30 On the Hourly that is in Bearish (directional) Market Bias, the bears are dropping down to head towards the Swing Low of 42,228. We'll see if they can first reach the lower end of the S&R Zone at 42,317. Once that's breached, then more profitable moves to the downside.
Alternative Scenario: If the bears can't do any of those moves in going down, then the bulls can take it back up to cross the Bullish Trendline (in green dotted line) to flip the market bias from bearish to bullish. If this happens, then a giant W-shaped pattern is likely to form with the 4th leg being a long, bullish trend.
US30 For Swing Traders: The Daily is in Bearish (directional) Market Bias after crossing to the right of the Bullish Trendline (in green dotted line).
Price action is also moving within a two-tiered Inside Day pattern for a market pause with no clear direction. The bulls rejected a breakout from the high of the Inside Day at 42,922, so the bears will attempt a breakout at 41,803 - the pattern's low. If there's a true breakout (and not a fake one) at 41,803 from the Inside Day, the bears can drop further down. We may see the Gap Up get finally closed with a candle close at 41,506 or lower.
US30 Last Call for the New York Session:
