SPX Is Coiling Very Tight For A Move, What Way? May 16th Plan

After the 100 point rally on Friday May 5th, ES has now put in an incredible 6 daily candles stacked tightly side-by-side in a ~60 point range, making this likely the tightest range since the March or January lows (both those resolved to the upside in dramatic fashion).

I concluded my last newsletter by writing: “My general lean though is that we held 4112 megaphone support today, and therefore, price can try to make the round trip to resistance again. This *could* look something like pop to 4147, 4156, dip, then attempt the break to the high 4170s”. This played out perfectly - we hit 4112 megaphone support Friday, rallied to *exactly* 4156 overnight and today.

This 6 day consolidation is getting close to breakout, and the move should be substantial. What way? In today’s newsletter, I’ll be talking this, talking my core setup (the failed breakdown) that started the rally that began Friday, then provide the actionable trade plan for tomorrow.