ES #F 091506 Options Expiration and New Contract High

Options expiration. Globex low sitting at 1328.00, and 6 points off the low gives us 1334.00, and 8points off the low gives us 1336.00, and 10 points off the low gives us 1338.00. We have a 1.618 fib target at 1336.50 -.75. All charts are currently extremely bullish. We have wave extensions, making wave counting a little bit more difficult. The price movement off the daily chart this past week makes the weekly and monthly charts more bullish.

This morning we had inflation numbers come out that states inflation is the highest its been in a while, and yet the market powers up. In a bull market, the market ignores bad news, and in a bear market, the market ignores good news. Is this typical options expiration activity?

After the open, will they try to sell this off to support?

Update at 09:30 EST: 1336.75 target hit; good sell short entry here with low risk.

Update at 09:50 EST: Market sold off to test the 1332.00 LIS, where old resistance becomes new support. Will this hold? We did make an abc 3 wave pattern down into 1331.75, which is a .786 fib level. 8min chart says more down is possible, however the 120min chart remains very bullish. Once again, the .786 fib now gives a bullish gartley butterfly pattern for a good JOT entry long. The only concern is that the 8min chart is NOT in agreement, therefore NOT an ideal trade, but it is a buy signal nonetheless.

Update at 10:17 EST: 5 waves into double top at 1336.75 for a quick pullback. Market remains bullish still, so let's see how shallow/deep of a pullback we can get. Let's see if we can reach 1333.75 and lower. IF the high is in, THEN we can expect an abc type of retracement to the .618 of range, which takes us to 1329.50 ish and gap close.

Update at 11:00 EST: Target of 1333.75 hit (.618 fib), and short term support at .707 fib of 1333.25. Weak buy signal here off the 6000V chart. However, the better buy would be a test of the current low at 1331.75, if we can get a good buy pattern setup there.

Update at 11:17 EST: Market testing today's low, but no good buy pattern can be found, so lower it will go.

Update at 11:25 EST: 5 waves down into 1331.25 so expect some kind of retracement. Market however, is more bearish now.

Update at 12:00 EST: Market remains bearish. .618 fib target is at 1329.25 and gap close is at 1329.50.

Update at 13:00 EST: gap is now closed. Continue to have mixed signals. Looking for bigger retracement.

Update at 14:03 EST: Looking for test of high and higher now.

Update at 14:16 EST: 5 waves up into 1333.75 -- looking for retracement before higher. Mixed signals so caution is in order. I can make the case for both up and down, so watching lower timeframes carefully.

Update at 14:36 EST: abc into .707 fib level at 1334.50. Wave c had 5 waves or "drives to top" pattern. Looking for retracement now. IF this is a wave 4, THEN we should see a lower low for completion of wave 5.

ES #F 091406 Retracement time

Now that the market has made a higher high into 1332.00, it has pulled back hard. 120min chart has a confirmed sell signal. Looking for a .618 fib level of yesterday's range, or 1326.00 and lower. So far, we have made a 3 wave pattern down before we ran back up to re-test the 1332 high, and now we are impulsing down thru the last s/r or LIS at 1326.25. Expect some stalling out here at the LIS or 1326.25 level.

Update at 09:33 EST: Support with GL at 1325.50 with buy signals off both the 8min and 6000V chart. Looking for retracement to try to close the gap at 1329.00.

Update at 09:39 EST: 120min and 60min are both bearish still. With mixed signals, we could be ranging for a bit before lower.

Update at 10:00 EST: Downside targets for today: 1326, 1324.50, 1323.50, test of 1322.25, 1321.50ish.

Update at 10:09 EST: s/t support at the .707 fib level of 1325.00. I count 5 waves down into the .707 fib level support. Expect some kind of retracement now, with both the 8min and 6000V chart in position to trigger buy pattern. Shorter term timeframes say we retrace, however longer term timeframe charts remain bearish. Market waiting for the Energy Report to come out.

Update at 10:30 EST: Backend support now at 1325.50. Higher timeframe charts remain bearish. We also made a 3 wave pattern into resistance at the .382 level of 1327.75. Looks congestive and more down is likely. The 60min chart is keeping me in short.

Update at 10:52 EST: downside target of 1324.50 hit. It is a .786 fib level of yesterday's range.
We now have a possible abc pattern into .786 fib level, with wave c having 5 waves. Let's see if the low at 1324.50 will hold or not. IF it hold, THEN it is a buy area for bigger retracement of last move down from 1332.00 high.

Update at 11:06 EST: Market trying to remain above the 1326.25 LIS and OP at 1326.75. 120min and 60min charts remain bearish with no confirmed buy pattern triggered. However, I expect the 1324.50 low to hold, and market to retrace, with possibility of gap fill now, since that is the .618 fib level (1329.00). The .786 fib support provides us with a bullish gartley butterfly pattern.

Update at 14:17 EST: market remains bullish; upside targets: 1326.00, 1329.75, 1330.25ish, 1331.00, test of 1332.00 high and possibly higher. The 120min chart had a 5034 JOT long off the 1324.50 low.

Update at 14:31 EST: Gap at 1329.00 finally closed; We now have bearish gartley butterfly, for another retracement, especially since we made 5 small waves up into the 1329.50 high. 120min still slightly bearish.

Update at14:43 EST: Support at another small .786 (which also happens to be the 1326.25 important LIS) for bounce back up. Let's see if 1329.50 becomes resistance or not. IF it is resistence, THEN look for lower lows.

Update at 14:55 EST: 120min chart has no buy signal. 1326.25 LIS is support for now. IF this breaks, THEN look for lower lows. The 120min chart should keep me short for now.

Update at 15:07 EST: s/t support off .786 at 1325.50 globex low. Since we had 3 waves up into 1329.50, I expect we shall make lower low. The move up into 1329.50 was a 3 wave pattern and a 1:1 price projection pattern. Trading below the OP and below the LIS of 1326.25 now. However, the 3 wave move down to .786 fib level now is a bullish gartley butterfly pattern. Let's see how far this will go -- it could go re-test the high at 1329.50, but not likely given the 120min chart -- we shall see.

Update at 15:56 EST: Another successful bullish gartley butterfly pattern into .707 fib resistance. Continue to have mixed signals, and now the 60min has a confirmed buy signal. Short covering now into the close.

ES #F 091306 Bears Got Crushed Today

Market traded lower overnite to find support at globex low of 323.25. It made a clear 5 waves down into GL support. The daily chart remains bullish, as does the 120min and 60min charts -- we are trading well above the 34ema and also above the 8ema. IF we continue up, THEN the upside targets I will be looking for a reversal sell short pattern are: 1327.00, 1327.50, 1328.00 ish and test of old contract high of 1331.25. IF we pullback today, THEN I will be looking for a test of old resistance at 1316.75, which is now an important LIS.

Also have to keep in mind, this is Options Expiration Week.

Update at 08:45 EST: small .618 fib target hit with double top for a good sell short entry with small risk. This makes for a bearish gartley butterfly pattern.

Update at 09:30 EST: butterfly target of 1.27 fib hit, and market found support at 1322.25 for nice bounce back up -- lets see if we can close the gap at 1325.00.

Update at 09:42 EST: upside target of gap at 1325.00 closed. New upside target is 1327.25 to 1327.50 ish to 1328.75. Needs to clear 1326.25 first before higher, so looking for test of yesterday's high before higher.

Update at 09:50 EST: Sell short against the high of 1326.75 good low risk entry. Downside targets: OP, test of GL, 1321.25, 1321.75 ish, 1320, 1319.25 ish. We are stuck in a narrow range for the time being -- buy support, sell resistance.

Update at 10:27 EST: Mixed signals indicating we continue to be stuck in same range. Higher timeframe charts remain slightly bullish, however, lower timeframe charts show weakness.

Update at 10:45 EST: We made a .886 fib retracement and test of low. IF this is wave 4, THEN we should go higher for wave 5 to complete a higher high. The test of the low gave a low risk entry long. So far, we have made an abc 3 wave pattern within the current range.

Update at 12:06 EST: 1327.50ish target hit; market remains bullish. 60min chart has no sell as of yet. 8min and 6000V both say pullback time here

Update at 13:30 EST: 5 waves down into .382 fib at 1327.00. Enter long for retrace and possible higher.

ES #F 091206 Upside Momentum

We remain stuck in the same range since last week. Overnite globex found support at 1308.00. We have mixed signals yet again this morning. Strong support at the 1308.00 level. Markets wants to go up to test the 1314.75 high. So far, we have had a 3 wave pattern into 1308.00 support.

Update at 09:32 EST: Market opens up strong, and we did indeed get to test yesterday's high at 1314.75; charts remain bullish. Double top now at 1314.75, but price action continues to be bullish; difficult to take the CT trade because of possible shallow retracements. If we take the sell short, we at least have a good entry with little risk, and can look for gap close. 30min chart remains in overbought area with no sell pattern yet.

Update at 09:47 EST: Price action remains bullish, with support at globex low. 8min chart setting up for a sell pattern, but it has NOT triggered as of yet.

Update at 10:09 EST: Test of 1316.75 high for a good sell short entry with minimum risk. Potential 5 waves up into 1316.00. IF we have 5 waves up, THEN we can looking for abc retracement into .618 at 1311.00 -- this is looking good for a gap close at 1311.50.

Update at 10:34 EST: So much for a gap close. Possible 5 waves up now into 1317.75; this is a 1.414 fib level. Higher timeframes remain bullish with no sell pattern completed. We will probably range for a bit, for a possible wave 4 before going higher. Upside targets today: 1317.50, 1318.00, 1319.50 ish.

Update at 11:08 EST: 1319.50ish target hit. Higher timeframe charts remain extremely bullish. This is a possible area for some consolidation. 1319.75 is .886 fib level. Massive short covering ... the "orange squeeze" as per tigerwings. 8min chart shows very strong uptrend - 8ema holding as support for price, we have "daylight", we are well above the 34ema. This is acting like an impulse wave 3.

Update at 11:23 EST: 8min looking weak, expect some kind of retracement. We have divergence, and a sell pattern that is about to trigger.

Update at 11:35 EST: 1320.50 is a 1:1 fib projection level. Setting up on 8min for a sell pattern trigger. This is a good low risk entry area for a sell short for a deeper pullback. No sell pattern yet off the higher timeframes, so possible wave 4 consolidation/congestion area before higher. IF it is a wave 4, THEN look for higher high to possibly sell short. Upside targets are: 1321.25, 1322.50, 1323.50ish (stronger PRZ here).

Update at 13:18 EST: IF this is wave 4, we should retrace deeper .. looking for test of 1316.75 LIS, then 1315.75 to 1313.75 ish as possible. I have sell patterns setting up and triggering off the lower timeframe charts

Update at 13:22 EST: nice double bottom for test of high and possibly higher.

Update at 13:50 EST: 1321.25 target hit. It is a 1.27 fib level after wave 4 type of pattern. 120min chart remains extremely bullish.

Update at 14:40 EST: 1323.50 target hit. Possible 5 waves up now. Watching carefully. 1323.50 was both a 1.414 fib and a 1.27 fib projection level.

Update at 15:53 EST: still no sell pattern off 120min and 60min charts.

ES #F 091106 Remembering 9/11

Market traded down into 1303 prior support during overnite globex trading. The Daily chart looks bearish, and intraday charts have mixed signals thus far. Higher timeframes have buy signals triggered, and no sell patterns as of yet off the 1303.00 support. The 1303.00 was a PRZ as it was both a 1.27 fib and a .786 fib, making it a bullish gartley butterfly pattern for the retracement move up this morning.

Update at 09:38 EST: Resistance at prior LIS of 1307.75 with a double top. This is also a .50 fib retracement level. 1307.75 is also at th 34ema on 60min chart. Low risk JOT sell short entry. Target will be test of low and possibly lower. Potential trending day down based on what I see off the daily chart. The daily chart shows that 1303.00 happens to be right at the UTL in place. We are currently trading below the 1308 area, which is slightly bearish. The 1308 was where the current contract opened after rollover, and also happens to be near the 1307.75 LIS.

Update at 09:54 EST: Short term support at the .618 fib of 1304.75. This is a bullish gartley butterfly pattern long scalp opportunity, should one decide to take a countertrend trade. IF one believes that the trend will be up from here, THEN that would have been a good entry long. However, the daily chart shows more bearishness than bullishness. The 60min chart shows that the 1303.00 is a potential bottom. Watching carefully.

Update at 10:00 EST: 60min and 120min chart shows that the LPT is for up for now. We could be stuck in this range for a bit. So long as the 1307.75 holds, we will go down.

Update at 13:30 EST: Downside targets are: 1302.75 gap, 1300, 1297.75 test, 12962, 1288.76, 1283.25, and lower.

Update at 10:54 EST: Lower gap at 1302.75 filled. Possible 5 waves down, so due for retracement. Higher timeframe charts remain bearish; we may only get a shallow retracement.

Update at 11:23 EST: Small .618 fib retracement of last small 5 waves down complete. This gives small abc bearish butterfly pattern. Mixed signals still. Higher timeframe charts have buy pattern in place, and no sell pattern as of yet.

Update at 12:32 EST: Current resistance at .786 fib, .886 fib and 1.618 for a small PRZ. Higher timeframes have no sell in place as of yet. Continue to have mixed signals, so could be ranging for a bit. 120min chart remains bullish for now. Looking for 1314.50 gap fill and possibly higher. if 1314.00 resistance is broken.

The low at 1300.25 was tested, finding support at 1302.50. Now we have climbed back over 1307.75 to 1308 all important LIS. We have had 3 waves now in this congestion range. Do we break out to new highs from here, or is there more retracement to be had after we close the 1314.50 gap.

Update at 13:28 EST: 1314.50 gap closed. 1314.50 is also a 1.414 fib level. Market remains bullish.

Update at 13:45 EST: 5 waves in wave 5? .886 fib is at 1314.75 and it is also a 1.414 fib. Let's see if we get a deeper retracement or not.

Update at 14:35 EST: ... and down we go. IF we have 5 waves up THEN I will be looking for .618 to .786 fib as initial downside targets for this move down.

Update at 15:02 EST: Continues to look bearish.

$SPX Chart Analysis for 091006

Market found resistance at the .886 fib level before retreating. Current support is at LIS. IF the LIS breaks, THEN first targetis the .618 fib level.

Potential sell pattern setting up for the market to go lower.

No confirmed sell signal as of yet.

$INDU Chart Analysis for 091006

Index found resistance at PRZ with a 1.414 fib level and .786 fib level. We have an UTL break with support at current LIS. IF this LIS breaks, THEN the initial target will be the .618 fib level.

Weekly chart shows potential reversal getting ready to shape up.

No confirmed sell signal as of yet.

Amgen (AMGN) Chart Update 091006

Amgen made a 5 wave pattern up into the .707 fib level before retracing. Let's see if it wants to test the current low at the $65.00 area.

Resistance area with LIS and 34ema and 89sma all clustered in the same zone. IF we continue lower, THEN we will have a blue ice failure type of pattern.

There is no confirmed buy signal yet off the monthly chart.