Another interesting day in the world of trading today with ES resuming its recent uptrend-at-all-cost and closing at the highs while EC closed at the lows, sure dont see that every day.
Here is how futures mutliple time frame trends ended up on the day:
ES 120 minutes has stayed bullish the whole day with 60 minute and 100,000 contract charts only briefly flashing sell signal before turning back bullish within 2-3 bars, ES closed with all 5 time frames looking bullish 2500 contracts up to 120 minute.EC on the other hand started out the day bullish through pre-market and later rolled over, finishing the day with all 5 time frames flashing bearish.
Lets drill down on EC now, on the daily’s EC looks like it is forming a bull flag after a 1000+ pip run up, in the ambush zone none the less.
As you saw from trend chart, situation seems a little more bearish and we could soon have a red waning candle on the daily generated if this continues to make new lows. Intraday it was a very tradeable today off of 987 tick chart:
In pre-market I flagged the triangle/wedge that was forming and alerted of first breakout being a false one, after bouncing around within the boundaries 2 more times EC broke the upside, backtested previous support and then crashed right through for 100+ pips, on the way down with another excellent set up of testing top of the triangle support one more time, with it being right around 50% retracement of the whole move, high probability trade considering even the 38% fib was being highly respected. -23% Target of that ambush was hit to the tick with several seconds to go in the trading session.
Here are a few channels to watch on larger time frame for EC, both of these channels will need to be broken to the upside if this will indeed play out as a bull flag:
ES emini continues to look very strong:
While ES remains impressively strong it is approaching crossroads and next week or so should tell the tale of where this heads intermediate term. Trend is still strong and green closing at the highs with a big green candle, nothing could be more bullish, also the very steep uptrend line intact since the lows has been successfully tested yesterday and sprung ES for quick 35 pts (PPT or whatever you want to call it, it’s still price that pays). 833.5 is an important level , being 50% retracement of the whole move from 1004.75 to the lows, shall that fib be broken along with two resistance lines while staying above current uptrend line, aka into the top quadrant, that would be very bullish for the markets most likely resuling in retest of 940s to complete what could be the head of bigger inverted head and shoulders. Breaking into right or bottom quadrant will likely result in more chop with possible retest of the lows.
In summary, very strong day for ES, especially considering dollar strength today, there is no particular reason to get in front of this rally just yet.
Cheers