Breakout For ES: Now What? July 8th Trade Plan
In yesterday’s newsletter, I talked about how ES had been building a base for week between 3750 and 3850, with the breakout occurring late day yesterday. I have been looking for a resolution higher to 3895-3900 for a week now, and we got there and cleared it today. Breaking out a week long base is a good sign for bulls, but does that mean its “all clear”? Not so fast.
This is now 4 green days in a row for ES, and interestingly, since the January high, every single time ES has rallied 4 days in a row it was either followed by a red day, or a major peak, with 4 green representing the maximum impulse for bulls since this downtrend cycle started. In addition to this, the 4hr RSI(5) is extremely overbought, indicating energy waning.
I do think this move in ES has higher to run, but there are some near-term risks. In today’s newsletter, I’ll be talking what they are, ultimate upside targets, pullback targets en route, and how I am managing my ongoing long position.