8/21 Daily Recap, Outlook, and Trading Plan
Recap
This week has been a masterclass in what I call “Technical Analysis 101”. The most significant technical event of 2023 occurred on Tuesday, with ES breaking down the uptrend channel connecting the March and May lows. This resulted in a 100+ point multi-day selloff, the deepest since before the March low. However, ES managed to put in a green recovery day on Friday, in the form of a bullish hammer candle.
Premarket
🌏 Asia: Down
🌍 Europe: Up
🌎 US Index Futures: Up
🛢 Crude Oil: Up
💵 Dollar: Down slightly
🧐 Yields: Up
🔮 Crypto: Down
World Headlines
The People’s Bank of China (PBOC) lowers short term loan rates slightly but disappoints markets by leaving longer term rates steady.
Key Structures
The large rising uptrend channel in white, connecting the March lows and the May lows, is the primary medium term channel. It failed on Tuesday this week, resulting in a significant sell-off. Other key structures include the declining channel in yellow and the resistance of the yellow trendline connecting the December and January highs.
Support Levels
The major support levels to watch are 4370, 4340-42, 4315-4305, and 4260s. These levels provide context to the daily price action and are not meant to be predictive.
Resistance Levels
The major resistance levels to watch are 4402, 4420-28, and 4487-90. Clearing these resistances would be a big structural win for bulls and could potentially lead to a recovery.
Trading Plan
In terms of resistances, I’d prefer to try shorts at the 4418 and 4428-30 cluster.
Wrap Up
Bears remain in control and any bounces are only relief until proven otherwise. My lean is that we can bounce more, to 4404, then perhaps 4420s before trying lower. If ES can clear that 4420-30 resistance cluster, there is a case for a more sustained bottom. 4370 fail triggers down direct.
Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
This week has been a masterclass in what I call “Technical Analysis 101”. The most significant technical event of 2023 occurred on Tuesday, with ES breaking down the uptrend channel connecting the March and May lows. This resulted in a 100+ point multi-day selloff, the deepest since before the March low. However, ES managed to put in a green recovery day on Friday, in the form of a bullish hammer candle.
Premarket
🌏 Asia: Down
🌍 Europe: Up
🌎 US Index Futures: Up
🛢 Crude Oil: Up
💵 Dollar: Down slightly
🧐 Yields: Up
🔮 Crypto: Down
World Headlines
The People’s Bank of China (PBOC) lowers short term loan rates slightly but disappoints markets by leaving longer term rates steady.
Key Structures
The large rising uptrend channel in white, connecting the March lows and the May lows, is the primary medium term channel. It failed on Tuesday this week, resulting in a significant sell-off. Other key structures include the declining channel in yellow and the resistance of the yellow trendline connecting the December and January highs.
Support Levels
The major support levels to watch are 4370, 4340-42, 4315-4305, and 4260s. These levels provide context to the daily price action and are not meant to be predictive.
Resistance Levels
The major resistance levels to watch are 4402, 4420-28, and 4487-90. Clearing these resistances would be a big structural win for bulls and could potentially lead to a recovery.
Trading Plan
In terms of resistances, I’d prefer to try shorts at the 4418 and 4428-30 cluster.
Wrap Up
Bears remain in control and any bounces are only relief until proven otherwise. My lean is that we can bounce more, to 4404, then perhaps 4420s before trying lower. If ES can clear that 4420-30 resistance cluster, there is a case for a more sustained bottom. 4370 fail triggers down direct.
Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
