Yesterday I pointed out the key touch at ES 1968, which was the bottom of the descending red channel. That worked out pretty nicely… 😉
Today we have rallied back to the top rail of that same descending channel–so now let’s keep an eye on the previous monthly bar close at 1993.50. Remember, that line is the first countertrend sell for the big boys in an extended market.
Let’s use ES 1993.50 as the new intraday bull/bear line and see if the pros decide to rally further up to perhaps chase the spotter stops at 2003–or if they pull it back again and maybe head for new lows now that the bears are in disarray and likely frightened ahead of the FOMC announcement coming out tomorrow at 2pm.
The channel has been working perfectly, so that’s the ST paradigm here, until it breaks….