The ES daily chart has a bit of a problem - a hitch - in it which is pretty glaring. That is, on a non-rollover day the chart has the large gap up in it that is shown, below, around the 6,552 level. The gap was a 'news gap' and, again, not one just from the futures roll-over.
ES prices today initially headed higher, stopped underneath the prior high in the six-bar congestion area, made a lower low than the open (not a new daily low) and then rebounded to find comfort at the 18-day moving-average-of-closes. It is very whippy, as is wont in the middle of the Bollinger Bands, and the algos have the control.
Is it likely the gap will fill? Yes, unless the news cycle keeps being manipulated with the sheer nonsense of the tariffs, the shutdown, etc.
As best we can tell, the up wave currently counts as w-x-y, where the y wave is shorter than the w wave. So, it might be a (b) wave, up, in itself. But we can't confirm yet that the up wave is truly over. Still, one would expect some resistance from the 18-day SMA, and that seems to be happening, so far.
So, we have to take it day-by-day counting as best we can. It is possible that some news item or other (earnings, etc.) might spark a (c) wave or more downward, but, right now the count is still sloppy until lower lows are made. There are still ways new highs could be made, like if the w-x-y turns into w-x-y-x-z and forms a diagonal. But that is speculation, as well. All we know is that at the present the local upward count is not an impulse one.
Have an excellent start to the evening,
TraderJoe
A sell off in the morning to under recent support (spx cash 6540) would give a bullish divergence on mid time frames. There would be a good chance of a major push up over the all time highs to take out stops and then reverse next week.
ReplyDeleteThank you as always for the charts and commentary.
Possible. Thx for the thought. TJ.
DeleteThe Dow has been struggling to hold its gains since October 3rd. The 100-year-plus Dow chart you posted recently is fascinating. If the top is indeed in at 47,000, an 89% decline over the next few years would take us to the bottom of the long-term lower channel—around 5,200. Interestingly, back in 1929, the Dow also hit the top of the channel, followed by an 89% drop to the lower boundary about 2.5 years later.
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