Let’s Revisit An Idea From a Week or Two Ago

I want to revisit a proposal I made a few weeks ago (here). Let’s see what that looks like today.

If we interpret the price action from May or so as a fairly large accumulation, we should have had a “spring,” from which we bounced with a real persistent bid to reenter the range. But, two things. First, the “spring” did get get very deep. I originally had it placed where the arrow points to. That was a great spot for a “spring” to land, just below the range. Instead, we fell even deeper, and we’ve not gotten the nice, powerful, persistent bid, and, in fact, what are supposed to be support lines are serving as resistance right now:

ES

So, there is a weakness here. The lack of a convincing bid has me concerned. Last couple of days feels like short covering only. And that can be very bad news. If those are the only buyers, and they’re all covering here, we can move very sharply lower. Now, if a strong bid enters the market, good, so be it. But, you can also see why I am increasingly becoming concerned here.


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