9:07 am Eastern  - We still haven't seen clear signals of a trend change. There has been a lift in price in the overnight and premarket sessions this morning, but price is still below key areas. They could go anywhere today. Again, it's difficult to point to any one thing and say "that's a clue that price is likely finished the drop". There are certainly traders who would like price to get back above the trendline - which for today would be around the 664.64 level. Closing hourly and then daily candles above the 664.64 to 665.00 area could be a good sign for the bulls. But they'd still need to get back on top of the longer-term zone. Above SPY 675 would be a start.

In the big picture, we see price bouncing from the 50-period moving average on the weekly chart in the SPY. Maybe that's all the bulls need to regain some momentum and keep climbing. Maybe not. Because the flip side of that conversation is that these kind of tests of support areas often take more then one hit before true support is established. Price could come all the way back down to around SPY 645.00 this week or next week and still bounce from down there. That's a big picture possibility. But at the same time, price really needs to get above 675.00 for the bulls to have a better chance of climbing out of this almost two-month pullback. Whatever happens, it probably won't happen in just a day or two. As we all know, anything can happen in the market at any time, but the probabilities are higher that we'll see more back and forth before we see a decisive move in one direction or another.

Right now, with about 25 minutes until the opening bell as I write this, price has been flirting with that  659.03 gap level we talked about a couple weeks ago. The bears did pull price down under it last week, and they've already tested it from the underside. But what this looks like on the daily chart is weakness. Price is still constrained under the daily 200-period moving average. For today, that 200-period MA is around 661, which is right above an official level we have on the board for today, at 660.34. If the bulls can break above 660.34 and then 661, and close hourly candles above that area, then the next level up at 664.64 is in their sights. And we've already discussed the importance of 664.64. It's in the neighborhood of where the trendline will be for today.

For the bear case, price is likely to keep falling if they can pull price down below 644 and get some daily closes under that level. That would put price under the 50-period MA on the weekly chart, and it would open the door for the monthly 20-period MA. Those are all big picture scenarios to be aware of. For today, the levels are designed for Base Hits. Sure, price is likely to move a lot and there be big swings. But trusting the levels for Base Hits is a long-term plan for success. As always, it's good to try to have additional confirmation on longer timeframe charts that a level should provide good support or resistance before trading against it. And giving the levels more wiggle room could help with price action is more volatile than usual. No data releases of significance scheduled for today. Trade well!

Trading by the Ticks & Trades Strategy, here is where you would have landed for the day:

Yesterday was easy. Today was not-so-easy. The level at 660.34 was hit early on and acted a great overhead resistance, but price fell from there before our window of opportunity opened. So unless you happened to get into a short trade against 660.34 before the close of the first 15-minute candle, that level was not traded today.

Then price fell into 657.68. The long position in the E-minis against that level resulted in a 20-point max loss limit. So that was closed out for a loss, strictly speaking. Notice that at almost exactly 20 points out of the money is where price reversed and started to climb back up toward the first level already hit? Well, I decided to hold on to my long trade against 657.68 and not jump out when it got 20 points out of the money. This is because I was betting on an area down there as being support. There was an intermediate trendline that I did not relate with a level this morning. I didn't think it was as important as the next level down at 655.02. That 655.02 level was indeed important, but the trendline above it and another small signal prompted me to hold on to that long trade. Yes, I saw a couple thousand or more out of the money (I was in a 2-ES contract position and did not add to it at the trendline), but I gave the bulls a chance to climb a bit and I was able to get a Base Hit eventually. Not the easiest trade, but it worked. 

The Recycle Trade against 657.68 worked as designed with no violations of the rules. So that was the first official Base Hit. Then price fell all the way down to 655.02 and bounced nicely. That was Base Hit number two.

Per the rules, a total of -12 ES points for the day.