So here were are now so lets look at what has been happening by looking at price and volume. Below is the daily SPX candlestick chart which highlights the area after 1685 support was broken. We concluded that the previous trading range was distribution and that a high volume price drop would ensue which what happened. So if we were focus our attention to the last two trading days we saw a break of the next support level at 1653. What was interesting today was the test of this broken support. Prices rallied back to the 50dma before reversing (resistance) and closed right at what is now resistance at 1653. So what we do now is wait to confirm if indeed this is a test and look to see if prices continue to lower. If it does then we look at the next support level which I will let you fine folks figure out!
Thanks for reading.