Yesterday at one point the 5 day cycle projection was 4420. Nailed it. Then the projection got to 4440. That was probably my brown sunglasses talking. 4420 turned out to be it.
In the overnight session so far, the ES S&P 500 futures pulled back to an exact 61.8% retracement of yesterday’s rally. And I mean exact. There the pullback stopped at around 3 AM in NY, and as I write an hour later, they’ve rebounded.
So, what next. The minute direction is still down unless and until they clear the trendline now around 4400. That line will be at 4395 when New York opens later this morning.
There are no projections yet on either the 5 day or the 2-3 day cycle. We need a few more bars.
If the pullback resumes and breaks 4385, then a full retest of the low would be likely. At that point the hourly cycle and momentum oscillators would still be in positive divergences. That would be a good setup for a low and a launch, a nice W bottom. Only if that fizzles at a lower high would lower lows then be likely today or Monday.
And in the bigger picture, this week’s selloff was almost an exact 50% retracement of the July 19-August 16 rally. Funny how that works. Here it is on 2 hour bars.
And now for your longer term listening and dining pleasure:
Chart Picks – 25 Buy Signals and 41 Sell Signals Give Us These Picks
Gold’s Rebound Increases the Risk
So You Really Think the Fed Can Taper?
Here Are the Stock Market’s Latest Targets
This is a syndicated post, which originally appeared at Stool Pigeons Wire at Capitalstool.com. View original post. If you are a new visitor to the Stool, please register and join in! To post your observations and charts, and snide, but good-natured, comments, click here to register. Be sure to respond to the confirmation email which is sent instantly. If not in your inbox, check your spam filter.
