ES Update

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ES is now up 12.5% since the bottom spotter signal was generated at 1068 on October 4th.

The highlighted multitrend paragraph sums it all up nicely…

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I have been harping on the significance of the 1214.50 area recently, and Stops and Targets’ next primary trend line is now lining up with that number, as well as the range top at 1211.75.

ES is presently tapping on the underside of the ST resistance trend line near 1204.  Many bears are going to be forced to capitulate on a breakout above that line, and momentum buyers will also be looking to enter at the technical breakout.  In both cases, buyers will appear–and buyers are what those who accumulated at the lows need to start capitalizing on the buy risk ventured forth near that IT trend line support line I pointed out at the low.

As the Stops and Targets multitrend paragraph explains–this is the target zone for the squeeze and the place where we are going to find out if this is a counter-trend bounce back to long-term resistance designed to squeeze out the bears–or the potential staging area for a bullish macro trend reversal.  Either way, S&T sure nailed that bottom at 1068, and those who caught the ride up from either that signal and/or my suggested VST entry at 1081.25 are sitting with very comfortable profits here near the top of the range.

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I pointed out the bounce off the IT trendline support at the lows.  ES has now reached the target of the triangle formed by ST resistance.

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…but the technical conundrum I have also been pointing out is that a move above 1214.50 would break the lower high/lower low sequence–and thus the bear market for many analysts.

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…a trendline resistance breakout has already occurred on NQ

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…and on YM, as well, but in all three cases price is near the top of the pivot consolidation range–but hasn’t crossed over yet.

We are near bearish capitulation here–but the unanswered question (and what is pointed out by S&T multitrend commentary) is whether buying can be sustained through the resistance at the top of the range once the forced buyers have made their moves.

…my .02

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