Sunday’s note said a break of last week’s range was close to a given and that whether it held was the whole trade. The break came on Tuesday. The hold didn’t.
Two tankers were hit in the strait Tuesday, crude went back toward $90, the bond market sold off, and ES closed at 7,642.75, through the bottom of the range with room to spare. Wednesday it traded 7,618.50, three points under Tuesday’s low, and then a soft ADP number landed and the market read it the old way. Small caps led, the 10-year backed off a 4.81% print that was its highest since 2023, and the index closed at 7,676.50, back inside the range it had left the night before.
So the week has done both things Sunday said it might, in order, inside two sessions. It hasn’t done the one thing that would have changed our size.
Below the fold: what one close each way does to the score and to the size, the six prices for the back half of the week, why the index trade is the reclaim rather than the break, and the two ways Friday can go.
