ES Update

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The long-term timeframe continues to be the ‘timeframe in play’ (though that should change to short-term within the next day or two) and the first S&T pullback target is the top of the ideal buy zone between 1217 and 1250

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A pullback from the VST target at 1285.50 continues, with the dotted red descending trend line defining the trailing profit stop guide for the most aggressive bears.  The initial pullback target is in the 1251.25 area, which lines up with S&T’s long-term ideal buy zone.  The next target lower is at 1234.25 and lines up with VST trend line support.

A rally and break back above the dotted red trend line would target 1294.75

…my .02

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ES Update

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The long-term timeframe is currently in play (note the little green triangle on the timeframe tab) and the last buy signal at 1215.50 is up about +58 points as I type.  The key line to watch going forward is rising long-term trend support currently at 1216.50

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I mentioned in my last post that the next higher resistance area was at the 1285 area, and that is where yesterday’s big move went.  Bulls are fine on a pullback all the way down to 1216.50, which is the weekly low and the S&T long-term primary trend support.  The next short-term target for S&T is at 1294.75, with an open gap just above at 1300.25.  The shaded green area shows the last ‘ideal entry zone’, and it was prescient.

It is a new macro bull market until/unless proved otherwise.

The bottom spotter on 10/4 at 1068 is now up almost 20%

…my .02

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ES Update

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The multitrend statement has now changed to indicate the potential end of the bear market and the start of a new bull market…

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Yesterday’s countertrend pullback to the ideal buy zone between 1215 and 1225  (with an initial protective stop at 1215.50… actual pullback low was 1216.50) has hit the next VST resistance target at 1251.25 and may be nearing the next Stops and Targets upside IT/ST target of 1254.25.  At the time of this writing, ES is up about +34 points from yesterday’s low at 1216.50-or about +25 points from the 1225 target on the latest trade signal.

As the S&T multitrend rating text explains, the key line to watch is 1216  going forward.  So long as ES remains above that line on subsequent closes– this is a new macro bull market, as improbable as that may seem to many out there (but not S&T members who caught the spotter low on 10/4).  VST resistance is now between 1251 and 1258, and the next major resistance above that band is at the 1285 area.

As I have mentioned several times in previous posts–the intent (in my opinion) of this explosive move from the bottom spotter low at 1068 has been to achieve a total capitulation of the bears, who were short nearly 75% of the entire float for SPY near the lows!  A position held short is always a guaranteed buyer at higher prices to the pros–and when you get that many traders on one side of the boat, this is what can happen.  My assumption has been that the broad market won’t pull back until the bears give up–and we may be getting close here to the next potential capitulation zone between 1251-1258.

…my .02


PS: I won’t be writing my usual morning update on Thursday, hence this late-night edition.

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ES Update

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Yesterday’s ST/IT counter-trend sell signal at 1254.25 achieved the initial pullback goal of touching the top of the IT ideal buy zone (see how that works) at 1225.25 (shown in first image above) and was a near direct hit to the top of the ST ideal buy zone at 1222.50.  Yesterday’s actual low was 1222.25!

Net gain for that countertrend trade was +33 points and trend following bulls ‘bought the dip’ at the shaded green ideal entry zone (where gain to risk ratio is 3:1 or better)

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Bears remain trapped above the old consolidation range high at 1224 (which also lined up with the bounce at 1222.25).

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I mentioned yesterday that a pullback was expected, and that was a textbook bounce.  Bears have to be careful not to get too greedy on the first selling from a countertrend setup, and it is especially important not to ever let the pros drag you to the wrong side of the market on any trade.

All trends are up > 1215 and we are now watching to see if the present bounce has enough power to challenge the recovery high, or if it stalls short of squeezing the bears again above 1255

…my .02

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ES Update

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ES has attained the IT/ST confirmed resistance targets I pointed out yesterday (for another +17 point gain) and now the bears have a shot here on a countertrend trade setup…

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The premarket high was a direct hit on the VST and S&T resistance targets and we are seeing some early profit-taking from that line, which is expected for the bulls.  I have drawn in two target zones for a pullback–the first one corresponds with the last VST trendline breakout area and also lines up with S&T’s initial target at the top of the ideal buy zone for trend followers.  This is a counter-trend setup here in a powerful macro uptrend, and so it is imperative that any bearish speculators place a strict exit/reverse stop above the session high to avoid being caught in a bearish failure and continuation of the present uptrend.

This market is extended and certainly due for a pullback, but it is going to likely come only when the pros have finished squeezing the bears into capitulation–and the depth of any pullback is going to shed some light on the staying power of the move from the spotter low and IT trendline support.  This is the best setup bears have had in quite a while, so let’s see what happens from this resistance.

…my .02

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