ES: Expect a Bullish Bounce

  • CastAwayTrader
  • June 26, 2023
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$ES #ES-mini #trading setup #Elliott Wave

If we examine a micro structure of that decline we will see it is structured as a complex corrective (w)-(x)-(y) structure, not a trending five wave down structure:

ES-mini, 13,500 tick bar chart

That implies bulls can start another leg up upon completion of that pullback.

Let’s now zoom-out to see two macro scenarios, a bullish and a bearish.

(1) the bullish “one-more-push-higher” scenario:

ES-mini 240 min chart

This bullish count will be valid as long as bulls hold ES over 4,306.75. We can consider that leakage as a micro wave iv down to be followed by another rally in a wave v up.

However, of bears violate that level that would be a solid confirmation that ES made a lasting top in mid June.

(2) the bearish “the top is in” scenario:

ES-mini 240 min chart

That non-stop leaking is a good argument in favor of the bearish “the top is in” scenario.

To confirm that ES actually made a lasting top we need either a break under 4,306.75 or a corrective a-b-c up bounce making a lower high followed by a breakdown under the low made by this first push lower (so far the low was made at 4,368.50.

Under the bearish count bears got a setup for a large decline in a wave (C) down targeting new lower lows (under the Oct’22 low). Normally an accelerated part of the decline starts after three consecutive lower highs.

ES Daily Support-turned-resistance for Tuesday is 4,381.50.

If bulls manage to reclaim that level we would most likely get a quick short covering rally to 4,408 (see the first chart above).

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