Two morning Thoughts on $ES

If the thought from last night is the structure we are building, I will need to add one modification to that. In the prior post, I had stuck my orange 5 at the lower rail of the falling expanding diagonal, but that is inappropriate if this is a true diagonal, as it would have made wave 3 of the ending diagonal the shortest (both 1 and 5 would have been longer).

So, more appropriately, if we do fall again, there is a cap to how low orange 5 (of pink C) can go: 3583, and I’ve noted that on the chart below. Just above that is the lower end of the box below us that represents two fib extensions of the depth of the GFC (which I believe are relevant here and discussed here).

So, a move down for orange 5 of pink C can go to 3636.75 (lower end of the box below us) reaching a fib relationship with the GFC while keeping orange 3 from being the shortest wave. And in expanding diagonals, the final wave often falls short of a trend line strike.

So, if we have another puke, this is a place we may stop.


I note that overnight, we have also struck and bounced (so far) on the lower rail of the bullish wedge. If that ends up holding, then the low might be in and we’ve done a weird 1 followed by a 2 (discussed here and here).


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