The Big Boys are Playing

China is playing at hosting a winter Olympics without natural snow. Russia is threatening to invade the Ukraine without the support of the rest of the world, and the US Federal Reserve is threatening to raise interest rates and scheduled an Expedited Meeting for Valentine's Day (see entry at this LINK if you haven't seen it already.) For its part, the US equity market - as measured by the ES futures - said, "whoa", and headed lower. The daily chart is below.

ES Futures - Daily - Under the Line in the Sand

On the prior day's post, we showed what we think the structure of the down wave might be in two different levels of detail. And, in the prior post is almost a 'play-by-play' of an impulse wave down after three waves up into this morning. For now, we'll say that prices turned the daily swing-line lower, with lower highs and lower lows, and finished with the bias down under the 18-day SMA, "the line in the sand". The upper daily Bollinger Band has been steadily been creeping lower as each day progresses - looking for the point where it can wrap itself around prices. And the daily slow stochastic crossed lower from over-bought conditions.

All well & good. But, note too that there is also downward overlap now on the 24 Jan and 26 Jan up waves, and this seems to categorically rule out an impulsing wave upwards. Rather, it seems like the lower daily Bollinger Band might be a target for a market that has failed at the 100-day SMA and at the 18-day SMA.

We shall see, of course. At risk commodities (especially Crude Oil, and to some extent Gold) are currently moving higher. Yet, things could happen. There could always be an 11th hour deal with Russia. Or the FED might decide to relent on Monday. But, so far, these things have not happened. We're not sure they will. They seems to be signs of everyone in a global community playing their own games in their own silos. And so, the madness might continue while the common folk like us hope for better.

Have a good start to your evening.

TraderJoe