Battle at the 18-Day SMA - 2

It should be abundantly clear from the partial daily chart of the ES E-Mini S&P Futures, below, that, for the last six-out-of-seven days, price has contacted the 18-day simple moving average (SMA) shown as the red curve. Today was one of those days.

ES Futures - Daily - Battle at 18-day SMA

Prices today initially traded higher overnight, then lower, but ended the session closing just under the 18-day SMA. With the close under the 18-day SMA, the local price bias remains lower.

Also on the chart, I have also shown the current SwingLine function since the Minor wave 3, low. This is the black line. Of interest is the portion to the right of the (b) wave. This portion of the chart has both a "higher high" and a "lower low". These are shown at  the arrows. This is a neutral pattern and not a trending pattern. A trending pattern would be higher highs and higher lows, or lower highs and lower lows.

However, with today's slight higher pattern the SwingLine has briefly turned up. This has a significant implication.  IFF (If and only if), there is a new low below 2424,50, before there is a new high over the previous wave 4 high, then this would turn the SwingLine into "Trending Down". Why? That is because there would be lower lows and lower highs and they would be under the 18-day SMA.

If this occurs, it would likely indicate with a much higher degree of confidence that wave Minor 5 was underway. Note that even if the current Minor 4 was exceeded higher, it could not start a trending SwingLine pattern higher, because then there would just be the current lower low, and then the new higher high - which is not a trend in the SwingLine.

Sunday-night to Monday-morning may help resolve the current neutral state of this indicator. Let's see how it goes.

Have a good start to your evening and to your weekend.

TraderJoe