To B or Not to Be

Readers of this blog know from earlier posts that we are trying to resolve two different levels of upwards channels. By resolve I mean either make a new high for the channel move or breakdown below the lower channel boundary, back-test that line, and/or fail. The prior hourly channel has been broken downward, with a five-wave move below that channel line - which is essentially the mid-line of the larger channel, shown. Now, as can be seen from the ES 4-Hr chart, below, this larger channel still needs resolution in order to conclude that a Minor B wave, lower, is actually underway.

As many readers know, and have experienced by now, a five-wave move down can - many, many, times - be only the 'c' wave of a larger fourth wave flat.

So, in the ES chart above, we must play the game, at least for a while, of waiting to see whether price goes over the prior high again, or not. Certainly, the MACD could be interpreted this way on this time scale. So, we must diligently watch local price action and try to sort out the impulses from the corrections. If price fails to go over the high again, it could mean a couple of things - one more dire than the other but we'll cover that in subsequent posts. For now, the news bots have the advantage as they look to create a gap up open for Tuesday. And we'll be interested to see whether this persists.

Have an excellent rest of the weekend, and a loud shout-out of 'thanks' to any veterans out there for helping or having helped to keep us secure.

TraderJoe