I’m 71 years old. I’m an atheist. I don’t believe in prayer. I am also a pacifist. But a time comes when it is necessary to support the resistance. Whether it be against the outrageous Russian attack on Ukraine, or the bullish attack on 4300 on the ES, S&P 500 futures.
The Russians are attacking Ukraine on all fronts. The bulls are simultaneously defending and attacking the S&P 500 on one front. It is a zone of both support and resistance. The battle is under way. The outcome will determine whether a massive top pattern is completed or not. If it is, the implications for those holding stocks long would be sobering.
In fact, they already are. From what I observe, a failure to break down now, another rally that fools the majority now, will only delay the inevitable.
The red zone is the battle zone. The upper line of that zone is 4295. That’s the resistance level to watch today. If it holds, then we look to the lower line for support. That’s around 4212. As you know, support and resistance can be penetrated and stretched before they break. We need to see a daily close above or below the range before we can be confident that either a new short term uptrend has begun, or the current short term crash trend is confirmed.
Here we focus on the day to day. For that, we normally use the hourly bars on the ES. While the sharpest downtrend channel has been broken, others remain intact. The ES would need to be above 4260 at the New York open to break the next downtrend.
There is not a clear uptrend channel yet. The one I have drawn is an educated guess. It suggests that trend support lies where multiple trendlines and support levels converge around 4225. If the market doesn’t bounce from around this level by the 6-7 AM hour in New York, then this channel doesn’t exist. It would suggest that the bearish trends are still very much in force.
There’s no 5 day cycle high projection yet. The 2-3 day cycle projects to around 4330. But if the ES has an hourly close below 4225, then I think we can safely discard that target.
For now, which is around 4:30 AM in New York, 9:30 in London, 10:30 here in Nice and the rest of Western Europe, and 11:30 AM in Kiev, the hourly indicators are still in a bullish configuration, and the Russians are still on the attack in Ukraine.
But the resistance is preparing itself to fight back.
For the big picture see:
Crash is Now a Coin Flip
Primary Dealers Are STILL Positioned WRONG!
Gold Breakout Points To More, Miners Swing Picks Look Good
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