Tuesday’s trade was more enthusiastic to the upside but continues to be somewhat range bound. The ES reached the session low at 4456 early in the session and it began to feel as if the market would start accelerating to the downside which as discussed would give support to the ES being in the initial stages of Minor wave 3 down. Those thoughts were negated as the buyers flooded back into the market pushing prices back above 4500 and eventually reaching resistance at 4524. This then suggested that the ES is finishing a Minor wave 2 correction of an Intermediate wave “3” down. Since the ES basically remains range bound tomorrow can still go either direction. Initially I suspect we’ll see additional upside with resistance to complete Minor wave 2 coming in at 4532 and then 4553. The moving averages are not totally in alignment to continue a stronger move up with the hourly and daily MA’s suggesting additional weakness vs. strength. Breakdowns from current levels should develop into acceleration quickly and move with purpose below 4456 and on down towards next support at 4538, 4288, and then 4217.
February 8, 2022