Current price action favours a continuation of the bearish leg following a 50% correction.
Early Asia trading has seen a mild bullish continuation following Wall Street gains overnight. However the lack of commitment to the buy side makes me wonder just how far this can retrace, as a retracement is more likely judging by the price action.
If you look at the 5506 high, the rapid sell-off from the Dark Cloud Cover reversal appears to be more of an impulsive wave, which would imply a further low. As we sold off down to 5537 the Weekly S1 Pivot and 50 day SMA came to the rescue and we saw a Tweezer Bottom formation, comprising of 2x bullish hammers. Whilst this has so far supported I am favouring this to be a relatively mild correction as the bullishness of recent gains doesn't quite match the bearishness of the preceding losses.
At time of writing we have just tested the 38.2% retracement, but as this is the only level of resistance I will allow for a 50% retracement as we also have the Weekly Pivot here which could provide a good resistance zone between 5420 and 5427.
If bearish setups appear beneath this zone then I will favour a continuation of the bearish move down to 5270 where we see March '18th lows and Monthly S1 support.