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.

ES #F 092106 Plan the Trade, Trade the Plan

Overnite support found at 1335.00 for a move up to higher high at 1340.00. A sell short against this is a good low risk entry. Higher timeframe charts remain bullish, but look ready to trigger sell short patterns. Watching lower timeframe charts for change in momentum. IF we have 5 waves up, THEN look for .618 retracement at 1335.25 for this sell short trade.

Update at 10:01 EST: Target hit at 1335.25 (.618 fib). No buy signal as of yet; looking for lower still. 120min chart and day session only chart both say more downside still (no buy signal as of yet).

Update at 10:09 EST: 1333.50 is a .382 fib level for a pause. Higher timeframe charts remain bearish.

Update at 10:27 EST: Possible 5 waves downinto support at 1332.75. IF 5 waves down into support, THEN look for abc retracement to the .618 fib level or 1337.25 in this case. This also happens to be in area of day's OP. Mixed signals currently, so stuck in range for now.

Update at 10:40 EST: 1335.75 is a .382 fib level for short term resistance. IF this is a wave 4 congestion area, this would be a good area to enter a sell short, with the expectation that wave 5 and a lower low will follow. Only concern is that the 8min chart is in the wrong position -- it tells me that the trade is high risk, as the 8min tells me that more upside is possible.

Update at 10:55 EST: 1337.00 is close enough to the .618 (1337.23) for a conservative exit. For the aggressive trade, one can hold long, so long as the 1332.75 low is not broken. The 15min chart says we have more potential upside.

Update at 11:03 EST: OP and .618 target hit. Remains bullish for the moment.

Update at 11:08 EST: 1338.50 and .786 fib target hit. Good sell short entry here, just based on butterfly pattern alone. Both the 8min and 6000V charts are in position to trigger sell patterns. However, both the 15 and 30min charts still in buy mode.

Update at 11:23 EST: 1339.00 is .886 fib level. Sell short against this high for .618 fib target or 1335.25ish. IF it remains bearish, THEN targe the .786 fib and test of low.

Update at 12:30 EST: Downside targets hit; remains bearish and holding for lower, or until I see a good buy signal off 30min chart. Next downside target is possible gap close at 1330.50 - then 1329.50 ish.

Update at 12:53 EST: 1330.50 gap finally closed. Still bearish though.

Update at 13:05 EST: .618 target at 1329.50 hit; holding for lower still. Next downside target to watch for is 1326.25 ish.

Update at 14:07 EST: If this is wave 4, then lower low first tgt to watch for is 1327.50 ish before the 1326.25 ish lower tgt.

Update at 14:35 EST: 1327.75 is a .707 fib level. Short term support here. Close enough to my 1327.50ish target. Strong PRZ here: .707 fib is 1327.75, 1.27 fib at 1327.50ish and 1.618 fib at 1327.50. While the higher timeframe charts remain bearish, we do have a potential 5 waves pattern down into a strong PRZ. Conservative exit here at support and aggressive trades can be held until close, with trailing stop. Next downside tgt is the 1326.50 ish area.

Update at 15:13 EST: 1326.50 target hit! Still bearish. IF it remains bearish, THEN next downside targets to look out for are: test of 1324.50 previous support and then test of the 1322.75 previous support. We should be finding support soon for a bigger retracement.

Update at 15:18 EST: 1326.00 is a 1.618 fib level.

ES #F 092006 FOMC day

General consensus is that the Fed will NOT raise rates. Overnite trading made a run to re-test the 1336.75 high. Current resistance at 1335.50 for a low risk sell short entry, as I count 5 waves into resistance (with divergence). Let's see if we can get a gap close this morning (1330.50). Lower timeframe charts looking toppy but higher timeframe charts remain bullish for the time being with no confirmed sell signal/pattern in place. The daily chart remains to be quite bullish for now.

Update at 09:45 EST: Market opened strong. Buy signal off OP now. New high expected. Upside target: 1337.50, 1339.25, 1340.50, 1341.75, 1342.50, 1345.25ish, 1358.75.

Update at 09:58 EST: Old LIS of 1336.75 is now important s/r. Higher timeframe charts remain very bullish. We do however have 5 waves up, so can expect consolidation range first before higher. Small double top for a quick sell short entry with low risk. IF we have 5 waves, THEN look for abc pattern into the .618 fib level (and lower). IF this does NOT happen, THEN the 5 waves were incomplete, and we have extension of wave(s).

Update at 10:17 EST: We have a mixed signals thus far, so caution is in order. We have a buy signal now off the 6000V chart. Is a higher high wave 5? Watching carefully.

Update at 10:46 EST: 5 small waves up into 1338.75 so good area to sell short with low risk.

Update at 12:29 EST: 1336.75 LIS is key level for today. Last 60min candle closed right at this level. This level acting like a magnet.

Update at 12:49 EST: IF we have 5 waves up, THEN look for abc pattern down to the .618 of range and lower. The current .618 fib is at 1328.50ish.

Update at 13:33 EST: Double bottom at 1336.00 for a long signal and pattern.

Update at 14:03 EST: Higher high made at 1339.75, very close to the 1340 target. Is the high now in? JOT sell short against 1338.00 - looking for lower from here.

Update at 14:50 EST: Seven waves down into support at 133.25 ( important LIS was 1332.00). Market rebounded only to find profit taking at .707 fib level of 1337.50.

ES #F 091906 Wave 4 and Wave 5 into Test of support

Market found support overnight at the .618 fib area of 1327.50. Sharp pullback off that GL support into a .707 fib at 1334.00. Short term resistance now at 1334.00 for a retrace to test the low at 1327.50. IF we have 5 waves up off 1327.50 THEN look for abc type of correction into the .618 of move up .... or 1330.00 ish -- to double bottom at 1327.50. We continue to have mixed signals -- lower timeframe charts are ready for a pullback while higher timeframe charts remain bullish.

Update at 09:02 EST: Market finds resistance at 13334.50, which was a prior resistance level.

Update at 09:39 EST: .618 fib target hit. Look for lower still. 3 points made on this move down. abc pattern into .618 level, making a bullish gartley butterfly pattern. 15min, 30min charts remain bearish for now, so longs are more risky, so scalp opportunity only if longs are taken.

Update at 09:57 EST: resistance at .382 fib level and 34ema on 6000V chart, making for a 5034 JOT entry sell short. Looking for the following downside targets: 1329.25, 1329.00, test of 1327.50, 1326 ish, 1325.75ish and test of the low at 1324.50 and then lower if remains bearish.

Update at 10:03 EST: short term double bottom; mixed signals still -- shorter timeframe charts say we could bounce . Could be shallow retracement, so watching carefully. It could go either way.

Update at 10:25 EST: .786 fib at 1329.00 target hit. Possible 5 waves down into this level. IF this is a wave 4, THEN we could be stuck in this range ( 1334.50 to 1327.50) for remainder of the day -- so scalping opportunities with buying support and selling resistance. IF this is a wave 4, THEN expect a lower low for wave 5 to complete eventually. 30min chart shows no buy signal as of yet. The .786 fib level here sets up a bulllish butterfly buy pattern and signal. Upside targets: 1332.25, 1332.75, 1336.25 (OP), 1334.25 gap close. Expect today's high to hold for lower lows.

Update at 12:10 EST: ... and lower we go; 1325.50ish target hit. Still more to come.

Update at 12:31 EST: 1.618 target hit at 1323.25 -- Let's see if there are enough bulls to try to take this up for a retracement. Higher timeframe charts remain bearish with no confirmed buy signal in place.

Update at 13:05 EST: Charts remain bearish, probably range for a bit before lower.

Update at 13:57 EST: Market has found support off 1322.75, or test of 1322.50 low. LIS is the current s/r at 1324.50. We need to clear this before the market can go any higher. 8min and 15min charts both have buy signals/patterns triggered. May not get very far, as the 120min remains very bearish; watching carefully.

Update at 14: 05 EST: Potential 5 waves down into the test of prior support at 1322.50. Looking for buyers to take this up now into the close. Upside targets for this move up are: 1330.00 to 1332.00 LIS test. .618 fib is at 1331.50ish.

Update at 15:54 EST: First upside target at 1330.00 hit; More upside is possible.

Update at 16:15 EST: Last upside target hit (.618 fib)

ES #F 091806 Waiting to Exhale (or for FOMC)

So far this morning, the charts look bearish - both the 120min and 60min charts have confirmed sell patterns and no buy patterns. Watch the lower timeframe charts carefully for buy patterns/signals to give indication that we have found support.

Update at 09:31 EST: Small double bottom off friday low at 1329.50 for an attempt to close the gap. Overall tone of market remains bearish. We now have an abc into 1329.00, which is a .618 fib level. This makes for a bullish gartley butterfly pattern. 120min chart remains bearish. Let's see if we can get a gap fill or not on this move up. Current LIS is 1329.50 s/r.

Update at 10:00 EST: Gap closed. We have a small bearish gartley butterfly now. Also, 1332.00 was a previous important LIS. Mixed signals now, thus making it a little more difficult to know direction.

Update at 10:20 EST: 60min bullish currently; caution is in order. Sell short against test of globex high at 1334.75 for low risk trade. Good for a 4tick scalp. Hold a runner for possible lower.

Update at 11:30 EST: We have an abc into .618 and thus a bullish gartley butterfly off 1331.50 support. Has the low been put in, and we go up to make a higher high from here? 120min and 60min chart both look more bullish for now.

Update at 12:05 EST: Another test of the the 1316.75 high. This is the second time up here, so watching carefully. We had 3 waves up into 1316.00, which was Friday's OP, and both a .886 fib and 1.414 fib level. Both 8min and 6000V chart in position for a sell short.

Update at 13:03 EST: higher timeframe charts bullish. So long as 1336 high remains in place, we will probably be stuck in this range.

Update at 13:30 EST: Potential 5 waves up into a 1.27 fib level at 1336.50 and test of 1336.75 high once again. We remain stuck in the same range. Good area for a sell short once again. Wave C should be impulsing, and take us to the lows once again, and possibly lower, to 1327.00ish. This is a PRZ (both a .786 and a 1.27 fib level).

Update at 14:11 EST: market found support off OP and .786 fib level for an exit signal for the short, and a reversal long, to retrace the move down from the 1336.50 high. Key kevel is LIS of 1332.00 -- we need to cross thru that in order to go higher, otherwise we proceed lower.

Update at 14:30 EST: 3 bars off 6000V chart, and we cannot crack 1332.00, so down we go. The 120min chart remains in sell mode. Looking for test of 1329.00 and possibly lower.

Update at 14:48 EST: We tested the 1329.00 low now. Let's see if bulls can take this market back up or not. Buy patterns on both 8min and 6000V charts.