A hold below 1258.3 has the initial target at 1186.7. This is the line in the sand for two opposing emerging harmonic patterns, shown in green and blue.
Below 1186.7 will invalidate the large green pattern, which offers upside bias to complete this scenario, and focuses on the completion of the blue pattern.
Below 1186.7 has the ideal target at 1035.7 and scaling points at 1120.3 and 1093.4.
A hold above 1186.7 keeps the green pattern in play but has some important resistance tests along the way, namely 1258.3, 1337.7 and 1431 to start.
I’m often asked what do I consider a hold when it takes out an important level, in this case a “hold below 1186.7.” Personally I like the higher timeframe I’m looking at, like this daily chart. For a one-candle close below 1186.7 followed by a smaller timeframe continuation to the downside, I like the hourly. Of course, choosing timeframes is a personal preference.