ES #F 080706 "What's most likely?"

The higher timeframe charts have now turned bearish. It is more likely we go sideways to down than up at this point.

The daily chart has made a higher high into 1297.75 and UBB with divergence. The 120min chart shows the market trading below the 34ema this morning and below OP. The 8min chart has been unable to close above the OP this morning. The 60min chart shows us trading below both the 34ema and the 89sma. We have been stuck in the range of the 1289.25 high and the 1278.00 low since the Sunday Globex trading session.

Mixed signals means sideways market and to use caution -- scalp mode only until we get the timeframes to lineup.

For now, the 60min CCI shows that 1278.50 low is support and that we could buy on test of that level. However, lower timeframe charts are bearish.

Are we in a wave 4 type of pattern? We are stuck in a trading range or congestion area. Either it will break up or break down. Shorter term says we will break down.

Downside targets are same as for friday: 1277.00 to 1272.25 range. However, IF this is a wave 4, THEN remember that we can be stuck in this range for a while -- so look for possible test of the 1278.50 low first before we go lower.

PLAN THE TRADE, TRADE THE PLAN!

Update at 12:00 EST: potential buy signal on 60min chart. It hasn't actually triggered yet though. We had a test of the 1278.00 low from Friday -- looking for possible gap close and higher to test of 1297.75 as possible if the buy signal 60min chart triggers. IF we are in a big picture Wave 4 for further upside, THEN upside targets are 1290 to 1293.50 range for next day or so. Since we have mixed signals, the key is to focus on the lower timeframe charts to give better clues as to eventual direction.

Update at 13:00 EST: We have been stuck in this trading range, making a series of 3 wave patterns. Overall tone of market is still slightly bearish.

Update 13:30 EST: There is a buy pattern off the 60min chart now. However, we have 5 waves up into 1283.75 so an abc into 618 would be expected as possible. 120min chart still bearish. Major indecision and still bearish tone to market.

Update 14:05 EST: .618 fib target hit; actually market found support at the .707 fib level. Overall tone is still bearish though. If short from 1283.75 high, then can hold for lower to target as posted above, and trailing a stop to protect profits in case the wave extension is not done yet. Reason I would hold 1 is because we have had 3 waves now in this congestion range. We have been unsuccessful in staying above the OP for very long. Definitely a scalper's market for trading today.

Update 15:07 EST: Target 1 at 1277.00 finally hit.