Today’s selling on $ES found support at a crucial fib retracement. As many of you already know, I am looking for intermediate 3 (the big orange 3 at the top of the image) to arrive soon. I have been hoping that it’s close and the little selloff we’ve had so far this week got me excited, but at least so far, it lacks the expansion of range that I would expect for a correction of the magnitude I am looking for.
What I am expecting in the initial move down for this correction is something more like what we saw last year in September of 2020. We need to get going, and we’re not yet. Now, if we fall apart, so be it, I’ll change my tune in a jiffy, but until then, I must observe that today’s selling came to the 38.2% retracement of what I have labeled as subminuette (red) 3. And that’s exactly where one would expect to find the 4.
Combining this piece of evidence with the other short-term structures I discussed earlier today leads me to believe that we may need to go a bit higher before the real fun can begin. Perhaps 4600 is our destiny. The bear in me hopes I’m wrong, and we should find out soon enough if I am.