I have been advocating for the longest time SPX will crash from 4800 to 1700. THAT is just one more reason why SPX needs to go to 1700 (to fill that friggin 27-month or longer gap)!!
Like I said 666 low back in 2009 desensitized everyone to repeating numbers. Markets made a high or closed a few times exactly at 4444 (with some decimal points). So obviously market will not do an about face exactly at 4444 but around that number (due to everyone desensitized from repeats). BUT I also said 4000's is BAD LUCK in the East and here we are back below that!!
Ahh, the Chinese. They hate the number 4, and Love the number 8 -- better if it's repeating. They love the color Red, and Dragons. Same, weird, thing with the number 666. Humans can be so feeble-minded, and impressionable. If not for Hollywood, bs, movies and the bible....we would otherwise love the number 666, and 13. If humans were taught and conditioned to hate the number 592.....everyone would be so scared of it....as laughable and absurd as that may seem,
ESL for you I assume? Well ".....exactly at 4444 (with some decimal points) ..." is not exactly in the English language if the fudge factor is large. And reversals are what matter. Not reaching and then surpassing like the level didn't exist - because actually it didn't exist, otherwise there would have a a reaction. A strong one. But this is all besides the point. Either a gap fills or it is a partial fill. There is a reason the term partial fills exists. Because a gap has not filled .... completely. And it doesn't matter if it is an index, etf, fx, future, options, stocks, crypto or beanie babies. A gap is a gap that is still there and matters until it fills completely.'
Of course. I used to believe the nonsense that most but not all gaps get filled. Chrysler or GM was one example someone talked about. The gap was from the 1930's, 40's or 50's. They emphatically claimed ... it will never fill. Then the mortgage meltdown happened and, whichever auto maker it was, filed for bankruptcy protection (both did actually) and stock went to zero or maybe pennies. Either way gap was filled. Everyday or almost eMini gaps up down overnight from prior 400pm ET close. One of the "easiest" trades it to wait for 930am ET open to gauge whether it is worth the risk to fade it.
So did you hold short positions even when the S&P was at 4800+? It's one thing to expect something. It's another to say there's an "obligation," put your money on the line and hold for 27 months (and it may be much longer...perhaps forever, before the S&P 500 ever goes below 2550 again).
Looking at this aa a purely statistical game, its pretty clear that most gaps do fill. Here is the RTH chart of ES since just before covid. The zones outlined in gray do fill, whereas the ones outlined in cyan do not fill. Now I'm not suggesting that someone is short from 2200 hoping for that gap to fill, but statistically, I would say over 80% do fill within a few weeks. On its own it clearly isn't an edge, but there are areas on the chart marked via the blue arrow where the gap fills almost to the tick and then price takes off again for a significant move which provides a good R:R. I'm sure there are some open gaps down to 666, so once again, I'm not suggesting these will fill, but in the most recent past now, the move up to 4015 just yesterday I had been on my radar because there was that huge gap that needed to fill (and it did so perfectly). And right now, I don't see any more gaps higher going all the way back up to the 4800 ATH. There is a gap at 3800, and of course all those cyan gaps lower down.
Chart image above says Globex. Here is what I have going back a year, eMini continuous RTH (@ES.D) trading only, every gap filled except the two (not one) recent occurrences since June swing low:-