(click images to enlarge)
I have highlighted the most important line in Stops and Targets’ ES multitrend statement…
“A newly trending bear market will not close above declining long-term resistance, which is presently at 1245.25”
The trend is down in all three major timeframes and the long-term timeframe is currently ‘in play’. Last price is outside of the ideal entry zone, so bears who missed the cascading signals detailed in my last post should wait for a better entry opportunity.
Many traders are looking for a bear market bounce, and eventually we are going to get one. Jumping to the VST timeframe, the descending dark gray trendline marks the line where the most aggressive bears are trailing stops. A cross and hold of that line would be the first confirmation of a bear market rally.
That VST trendline resistance is presently aligned with Friday’s high at 1219 and the resistance level at 1217 pointed out in my last post, which was the ideal bearish entry on Friday. A rally that were to break above those levels would start to trigger buy-to-cover stops, and would be a VST countertrend buy. See how that works?
Lower high/lower low sequence remains intact and is the sign of a trending bear market, which Stops and Targets warned was coming on a break below the old trading range at 1300.50
Next VST targets below are indicated on the hourly bar chart above. All eyes are on the VST resistance trendline, otherwise.