The upside correction effort still capped by 126-02/025/05 barriers for bias for a roll back lower and more negative tone into the FOMC on Wednesday.
Before the current rebound, the previous break below 124-215, the 38.2% retracement of the entire 2013-2015 rally to approach next key level at 124-13 has set a bearish tone for June.
We see a downside bias for 125-14/12; break here aims for 125-035 and opens risk down to 124-235.
But above 126-02/025/05 opens risk up 126-13/15, which we would look to again cap.
Short/ Intermediate-term Outlook - Downside Risks:
We see a more negative tone with the bearish threat to 124-145/13.
Below aims for the 123-315 key swing low and longer term targets at 123-015 and maybe even the key 121-205 swing low.
What Changes This? Above 127-01 eases bear risks; through 127-23 signals a neutral tone, only shifting positive above 128-305.
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