c505218304b50c59c3659f6dda43bae7-links-0–> The futures dropped continuously from 2180 ES without stopping all the way to 2100 –not a single bounce. If it drops this far without a single bounce, I’m inclined to say that there won’t be a shortable bounce. That might be it — especially because 2100 is where the prior resistances (now support) currently reside.
Also, the manner in which we moved up on an intraday basis is not typical corrective action.
So this drop began basically early Friday morning — sold into the close — continue selling throughout Sunday night -and consolidated early monday morning – basically till 7am / 8am before it started showing signs of versing.
During this time, there was not a single bounce — as there was during the Brexit drop. Given that it went straight to 2100 support / target without a bounce, and the fact that the rise did not appear corrective, means no short trade that was initially planned was executed.
Given the size of moves in case I’m wrong, I’d prefer to wait it out as the risk in terms of size in either direction is larger than what I feel comfortable dealing with.
I think the low at 2100 might be in. We closed above 2150 – and although this is supposedly resistance region, the momentum is quite strong to the upside.
Either we are in an ending diagonal – having just completed wave 4 – with wave 5 up (pink) — or this was just wave ii of blue — and there should be a wave 3 grind back up.
As we currently sit at resistance, the main question is whether this turns back down or it consolidates and moves higher. Without any clear patterns to the downside or the upside — it is difficult to tell, but I am inclined to say the bottom is in.
This kind of straight down and straight up – makes wave counting not very useful because there is no structure to work off of. I wish we got more squiggles so I could be more certain of a trade.
Both Russell and S&P – had a 5-wave a-b-c-d-e triangle between 4am and 8am – once it broke out of that triangle, it did not come back.Each pullback did not go below any prior dips.
The blue-wave S&P prediction was for a bounce towards 2145 and then reversing below 2100. We did go over 2045 today, but Ibased on structure of waves already touching 2100 overnight before a bounce even happened and then reversing, I am not confident we will go below 2100. In fact, I believe there’s a greater probability that the low is in.
Silver is basically where it closed Friday. I revised the blue count – and now finally see the waves more clearly. The drop was way more than I expected, but fits in line with the structure of a full 5 waves down – going below the prior wave 2 at 18.82 — towards 18.76 early this morning. Basically, it erased the entire rally from last week.
The main question si whether the top last week at 20.2 was an A wave or a B wave. If B-wave, then we would only get a small bounce before going back down again. If (A) wave, then we should be able to get back above 20. So it really depends on how silver does in the next day or so.
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