The 1st 200dma Test For ES Since April, Decision Time? August 17th Trade Plan
From July 30th to August 9th, ES consolidated sideways, forming a textbook bullish symmetrical triangle as written about here. On August 10th, we broke it out and price is doing what it always does after breaking out a two week pattern: Rallying non-stop, trapping shorts on every dip, and running to the next large resistance zone.
For weeks, I’d described this resistance zone as generally being the 200 day MA (4325) as well as the core downtrend line from the January high at 4345 as being key magnets. In yesterdays newsletter, I wrote about how I was holding longs, adding above 4305 with the 200dma at 4320-25 being 1st target and today, for the 1st time since April, the 200dma was back-tested and we dipped.
This is important, as the basis for this being a “bear market rally” becomes very thin historically if we can clear the 200dma. In today’s newsletter, I’ll be talking today’s trading, breaking down a *perfect example* of my core trading setup this morning, talking the next targets up, and what the trigger for this rally to fail is.