The case for the harmonic short squeeze has weakened.

We've now traded in a range for a long time and this weakens the case for the bull trap with a harmonic D leg. While it's hard to refine down to a science of any sorts - usually the turns in a harmonic are crisp and sharp - this is what creates the W (Or M) structures.

To create the W structure the market has to make two "V" shaped lows. When there's a prolonged range this V shape becomes impossible, and I find most of the time this happens the extension for the harmonic will not come. Breaks are more common.

Any time we have a prolonged range it's important to be aware of spike out risk. I'm short from 3950 w/ stop 39570 but would also be interested in shorting 3990 w/ stop 4010 if we spiked up.

Bears need to close under 3946 to break macro supports and I think a close under 3910 firmly suggests the bear is in play.


Update to