Why S&P 500 Might Be Headed Down

The above chart is my best rationale for why I think that we should be headed down in the ES contract tomorrow (Friday).  There are several reasons:

1. Indicators all have more room to run before becoming oversold.
2. We formed a Head and Shoulders Pattern - 3 circles
3. We retested the head and that retest failed.
4. We dropped hard and have started to form a channel.
5. I think that this channel will lead us to a retest of the lows (eventually)
6. If we can close below the Wedge for two days, then good indication we’ll go lower.
7. There’s another smaller head and shoulders with the right shoulder at 852.
8. It’s possible we could run up to 852 and fail there.
9. Finally we could also make it to 918, making even shoulders and fail from there.
10. Given that it’s Friday before a long weekend, volume will be light.
11. They could push this anywhere.  I will most likely be on the sidelines most of the day.

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