E-mini S&P December's new all-time high was exactly at the 4735/40 target in the bull trend, but severely overbought conditions finally kicked in with a sudden collapse to the 4670/68 target.
This leaves a bearish engulfing candle, which is a very short-term negative signal. We do have severely negative divergence on the daily chart so there is a risk of a further correction, but I think there are too many retail traders betting on a crash for it to happen just yet.
NASDAQ December hit the next target of 16640/660 then a new all-time high at 16767. However, prices then crashed leaving a huge bearish engulfing candle, which is a very short-term negative signal.
E-mini Dow Jones December shorts at first resistance at 35850/950 worked perfectly with a high for the day here, followed by a retest of last week's low at 35490.
Today's Analysis
E-mini S&P first support is at 4670/68, but a break below 4660 targets 4640, then the best support at 4630/20. Try longs with stops below 4610. There's very minor resistance at 4700/10, but above that retargets 4720/23 and 4735/40, then 4750.
NASDAQ December collapsed through first support at 16450/400 to target 16300/270, then best support for today at 16230/200. Try longs with stops below 16150. A break lower however sees 16200/230 working as resistance to target 16100 and 16030/010 before a buying opportunity at 15900/850. Try longs with stops below 15800.
First resistance is at 16400/450. Shorts need stops above 16500. A break higher targets 16550/600 before a retest of the all-time high at 16630/767.
E-mini Dow Jones December strong support at 35450/350. A break lower however targets 35100/35000. Watch for a bounce from here on the first test. However, a break lower meets a buying opportunity at 34800/750, with stops below 34650. First resistance is at 35850/950. A break above 36000 should be a buy signal targeting 36230/250.
