$ES #ES-mini futures #trading setup
The last week produced the narrowest weekly trading range for several months. When an extended move is followed by a doji candle with the narrowest range for 8-10 bars that almost always leads to spike in volatility. The rule of thumb for any trader is: “Contraction in Volatility Always Often Leads to Expansion in Volatility”.
Let’s look at the 240 min chart:
There are two main resistance levels.
The first one is 4,213, the red horizontal line. That same level stopped down swings in Feb – Mar 2022, stopped up swings in May 2022, September 2022, December 2022 and Feb 2023!
Another resistance is the thick red trend line that connects August 2022 and Feb 2023 tops:
Ideally, I would like bulls to push ES-mini to at least 4,166 – 4,176 in a subwave b up. There is a chance that bulls push ES to a slightly higher high to test that red horizontal line at 4,213.
If ES-mini spikes over the declining thick red trend line to 4,166 – 4,176 but then drops back under that would be a short setup to ride a subwave c of a wave -b- down targeting the Green Box.
As long as bulls hold that decline in the second leg down (subwave c of wave -b- down) over 4,050 we will consider that decline a buying opportunity to ride another leg up in a wave -c- up that can push ES-mini up to 4,300- 4,400.