There was a famous sports reporter named Warner Wolf in the 1970s and 1980s whose expression was , “Let’s go to the video!!” When stocks correct we do not go to the video but rather, "Let’s go to the retracement!!”. This tool looks at the range of a move from a low to a high and tells you how much of the move has been retraced.
There are two retracements we are looking at now. The June low to July high. Right now we are below the 50% retracement. However, we have tested the 61.80% retracement and if we fail at $423.51 then a 100% retracement of the June low could be in order, $414.92.
The second is the May low to the July high. Its 50% retracement is at $420.96. The 61.80% is at $416.96. The reason we focus on the retracements is that computers which trade know where these levels are and they made test them. The most important test and hold for know is $423.51. If this does not hold, then $420.96 will probably be tested.