Bulls Bought The FOMC Dip In SPX. Will The Rally Continue? June 19/22

Key Takeaways

• Bulls targeted the 135‑point dip after the June FOMC meeting
• Failed breakdown at 7482 signaled institutional accumulation and short‑covering
• ES recovered above 7578 by early afternoon, confirming bullish momentum
• Strategy calls for retesting 7590‑7611 levels before next rally
• Upcoming newsletters will detail new failed breakdowns and next‑day plan

Pulse Analysis

The June Federal Open Market Committee (FOMC) decision triggered a sharp 135‑point plunge in the S&P 500 e‑mini (ES), a move that many retail traders interpreted as a sell‑off. Yet the dip was anticipated by a cohort of bullish participants who view such headline‑driven volatility as a buying opportunity. By positioning ahead of the decline, they aimed to capture the liquidity that institutions generate when prices tumble and then rebound. This pattern of buying the dip after major macro announcements has become a recurring theme in recent market cycles.

Technical analysts label the price action at the 7,482 level a ‘failed breakdown,’ a signal that the market has tested a low only to recover quickly. Such moves often trap short sellers, providing the liquidity institutions need to rebuild positions without moving the market further down. In the ES chart, the brief slip to 7,475 followed by a bounce above 7,578 illustrated this mechanism, confirming that institutional buying was underway. Recognizing failed breakdowns allows traders to differentiate between genuine weakness and temporary, headline‑driven volatility.

The next tactical step for bullish traders is to target the 7,590‑7,611 corridor, with a potential retest of the 7,635 and 7,669 resistance zones. If the market holds above 7,578, momentum could carry it toward those levels, providing a clear entry point for those who missed the initial dip. Conversely, a failure to sustain the bounce may signal renewed short‑covering pressure and a possible pullback. Monitoring upcoming failed breakdowns will be crucial, as they often precede the next leg of the rally and shape short‑term price action for both institutional and retail participants.