ES Daily Candle: Higher High, Higher Low, Higher Close: Trend Candle
Market Posture: Neutral-to-negative and Probing
Daily Swing Line: Neutral (Higher High, Lower Low)
Daily Bias: Up (Settle Above 18-day SMA)
ES futures prices gapped up overnight (which is a little unusual for the futures) and rose about 20 points. I don't suppose that had anything to do with the newly posted $23 Trillion in debt, right? Prices hit and exceeded the upper daily Bollinger Band as in the chart below. As soon as the cash market opened, they began a slow steady decline, losing about 10 of those points, and then drifted sideways to close off the highs.
|ES Futures - Daily - Strike Upper Band|
Again, it is "not often" that the futures gap higher. I've posted this chart so you can see when futures gap higher (as in July, and again in late October). Such gaps are often relatively quickly filled when compared to cash gaps.
With the Bollinger Band hit, one target has been achieved, and the so-called Smart Money often takes some positions off at the upper band. You may wish to review Ira Epstein's guidelines for what happens when price hits the upper daily band (see this LINK).
The immediate count will be better able to be resolved when and if we see if tomorrow is a "turn-around Tuesday". The local count of minute ((a)) up has become muddied by the slightly longer than expected wave today, but we are still in the Intermediate (B) wave. One question is whether the minute ((a)) wave belongs in the original location, and we are now in the minute ((c)) wave? Or - is it possible the minute ((b)) wave will form a large triangle of it's own. I'll be working on questions of this type over the next several days.
The daily slow stochastic has remained embedded, and price remains over the 18-day SMA or 'line in the sand'.
The Dow Jones Industrial Average finally made a new all-time-high, and closed above it daily cash
It is also worth noting that as the stocks market has made new highs, the daily VIX has not had a lower low since April. There is some divergence there - let's see if it holds.
Have a good start to the evening.