As third quarter comes to an end the prospects for Federal Gov’t shutdown is likely. Markets for the most part have taken the political bantering in stride, but clearly any extended shutdown could have rippling effects and the Markets do not like uncertainty, hence a gap down for Monday.

Price has “Jumped the Creek” which means a gap in Globex beyond closing weekly prices. The violation of Prior Weekly Low (PWL) at 1680 targets 1670 – 73 zone which price is currently trading at 8 am ET. Continuation of current weakness suggests price could fall further to 1662 – 65 zone which is a multi-time frame extreme.

Penetration of Globex High 1676.25 targets 1680 then back to 1685. Traders must respect the current break as valid as we’ve been opining this past week that BIG $ has been in “sell-mode” on any bounces. Also, keep in mind the “news algos” will be turned on, so if there is any “blabber-mouthing” from politicians the algos will respond to “key-words” mumbled.

Remain disciplined and flexible.

Good Trading…David

Habitude Seven
I take the long term view. I am willing to lose in the short term. I understand that losses are a necessary cost of doing business, like inventory to a merchant. Drawdowns are viewed as temporary. I realize that my wins and winning periods are part of the broad process. Each trade is but one in a string of trades. What is happening now is one piece of a much larger puzzle. Because of this I do not get overly euphoric or despondent.