ES NarrowingTriangle

(click image to enlarge chart)

The 3/17 high and gray trend channel touch at 1165.50 (blue arrow on chart above) continues to define the epicenter of action between bulls and bears here in the very short term.

There is a preliminary spotter detection signal in place (magenta arrow on chart above), but it remains as-yet unconfirmed.  The dashed magenta line shows where ES would need to close below to confirm the signal.  If ES takes out the spotter high at 1176.50, then the signal is immediately invalidated.

The shaded blue area defines the resistance void area between 1165 and 1277.  That void of resistance could either lead to a stall in momentum of the upward thrust from February lows—or it could lead to significant gains if an upside breakout from this consolidation zone can be achieved.

A key feature on the chart is the red trident channel top rail drawn in from the spotter high.  CT bears are likely playing off that line (as they were off the two previous dashed red lines—but without a spotter signal in place on the two prior setups).  If ES can jump that line and hold above, then the bulls may be able to trigger another breakout move.  On the other hand, if the spotter signal ends up being valid, then that line may contain any upside thrusts designed to shake off the new CT bears.

The first significant bull stops are most likely located under the bottom of the rising gray trend channel shown on the chart above.  Each day of sideways price movement brings those closer into range–along with the rising S&T short-term primary trend line presently at 1144.

Key features (in my opinion) are the descending red trend line, the rising gray trend line, and the epicenter line at 1165.50.  Eventually one side or the other of that narrowing triangle is going to be run and this could be setting up for an eventual taking of both sides’ stops before the next trending move away from this consolidation.

…my .02