ES #F 092206 Trade What I See NOT What I Think

The daily chart has turned slightly bearish. All timeframe charts remain bearish for the moment, but they are in position to trigger buy patterns. Market is testing yesterday's low at 1325.50 and looks likely to break, based on daily chart. However, we could be stuck in this range for a bit. The only trade currently is a long off the test of the 1325.50 low for a retracement -- scalp opportunity for conservative traders. Buy support and sell resistance. Trade the "ends" for lower risk and higher profitability. Target for the long trade is the gap close at 1330.25. This also happens to be a .786 fib level. IF the market is unable to get to the .618 fib at 1329.25, THEN market is very weak, and an early sell pattern that presents itself will indicate market wants lower.

Update at 09:10 EST: Market finds resistance at the .50 fib level or 1328.75 -- moving average resistance overhead. We have a 3 wave pattern into the 1328.75 resistance level. The 8min chart gave a sell pattern, for a test of the low. Expect the low to hold for a gap close. IF we are in a wave 3 impulse wave, we should see 1316.75 today or Monday.

Update at 09:32 EST: Mixed signals so far. Could go either way. Price action more negative than I would like.

Update at 09:36 EST: IF the 1326.00 low does not hold, we will make a lower low for wave 5. We have a second sell pattern triggered now off the 8min chart. IF the 1326.00 holds, then look for gap close. Eventual downside target to watch is 1324.00ish for now, then test of 1322.25.

Update at 09:45 EST: Aggressive long entry off the double bottom at 1326.00 for gap close. Reversed too weak. Down it is.

Update at 10:10 EST: Important LIS is 1316.75 to keep an eye on.

Update at 11: EST: We have possible 5 waves down into 1321.00 support. 8min chart shows support with possible retracement commencing. IF we have 5 waves down, THEN look for abc retracement back to the .618 fib level or 1327.50. IF we have an even bigger 5 waves down from the high of 1340.000 THEN expect the gap to be closed.

Update at 12:02 EST: Sell pattern off both the 8min and 6000V chart at 1324.75 resistance. Never ignore confluence of patterns, especially when I also can count 5 waves up into resistance. No confirmed buy patterns of higher timeframe charts yet. Lower timeframe charts more bearish currently. Looking for test of 1321.00 low. IF the 1321.00 low does not hold, THEN look for the important LIS of 1316.75. Given the daily chart, I would not expect the 1321 to hold -- the only question is, will the market take the scenic route down to 1316.75, or will it just get it over with, via the direct route. IF we are in a wave 3 impulse wave, THEN we should see 1316.75 either today or early next week.

Update at 12:20 EST: Long scalp oppportunity off test of the 1321.00 low. 1321.50 was a .886 fib level. High risk, as the likely direction is more down.

Update at 12:42 EST: 5 waves down into test of 1321.00 low with divergence and buy signals off both 8min and 6000V chart. Look for .618 to .786 fib -- 1323.25 to 1324.00ish on this small buy signal.

Update at 12:49 EST: Upside targets hit; Continue to hold runner for more upside. Upside targets now: 1325.00, 1325.50, 1327.50, 1329.250 ish.

Update at 13:07 EST: First upside tgt hit at 1325.00 ( it is a .382 fib of last move down). So far, we have abc 3 wave pattern into a .382 fib level ... watching this carefully as this could be a wave 4 for lower. Today is a good day for scalping for lower risk. Exit runner long.

Update at 13:24 EST: Double top for low risk entry sell short. Mixed signals though so could go either way.

Update at 13:50 EST: Looks like a wave 4 type consolidation/congestiion wave. Lower lows to come. Sell signals now off 8min and 15min charts. Test of low and then lower if 1321.00 breaks.

Update at 14:47 EST: Downside tgts: 1320.00, 1319.50, 1318.50, 1316.75 test.

Update 15:21 EST: 5 waves up for wave c into 1326.75 resistance? Sell short after 5 waves up for pullback/retracement. Good for scalping opportunity. Higher timeframe charts remain bullish.