All rallies till late September are sucker rallies. This is a much different market than the one we had in May-July. We are trading based off of news in the US, not in Europe. This selloff will last longer. Also, the crowd has been conditioned to buy at 1040 and sell at 1120. This has happened several times over the past few months. That is why short term traders are complacent. Emphasis on short term. The intermediate term and long term traders are very nervous.
I believe we will have a last gasp rally next week, perhaps to 1070-1080. That will be the time to unload longs and reverse to the short side. In September, I expect a 9 handle on the ES.
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