$ES #ES-mini #trading futures
We still do not have clarity if the January 2024 rally is a corrective wave -b- up or teh second leg up in a subwave ( c ) of wave ( iii ) up.
Let’s start from the first scenario where this rally is a subwave -b- up of the wave ( b ) of ( iii ):
Under the Running Flat scenario bulls can keep pushing it up to 4,947, a negative -138.2% ext of the July – October 2022 decline. Then we should get a quick and sharp drop in the subwave -c- down to the Green Box.
But we can be dealing with the wave 5 up shaping as the Ending Diagonal.
Quite often, the final wave 5 is shaped as an Ending Diagonal, a five wave up move with a clean (a)-(b)-(c) subdivision of each wave. A hallmark of that structure is deep corrective waves that often test the lower trendline that forms the lower edge of the upward sloped price channel.
Here ES tests a minor resistance of a 100% ext of the subwave (a) of wave ( iii ) up.
In a normal five wave up structure 100% ext of the subwave (a) of wave ( iii ) up is where a micro wave -iii- of (c) of ( iii ) often tops out.
However, if we really deal with the Ending Diagonal, then we can get the top of the wave ( iii ) right here at that 100% ext = 4,913.
Under the Ending Diagonal pattern a wave ( iv ) down can come as very deep pullback that goes all the way down to the top of the wave ( i ) up:
So, in any of those case, I would expect at least a minor pullback in a micro wave -iv- down back to 4,750.
The Daily Resistance is 4,905.
The Daily Support for Es is 4,874.
To turn the trend down bears need to close a day under the Daily Support.
Watch my last three videos and learn How I use the Daily Support and Resistance to identify the trend direction and a phase of the trend move.
What are Daily Support and Daily Resistance levels.
I explain how a trend up starts, how it enters into an accelerated mode and how it ends and transitions into a distribution mode. The cycle trader indicator does that work for you. it allows you to identify what phase of a rally we are in just at a glance using its framework, the Daily Support and Resistance levels.
I explain how a trend down starts, how it enters into an accelerated mode and how it ends and transitions into a accumulation mode. The cycle trader indicator does that work for you. it allows you to identify what phase of a trending move down we are in just at a glance using its framework, the Daily Support and Resistance levels.