The Relief Rally Continues In ES, Major Resistance Overhead: May 18th Chart
In yesterdays newsletter, I talked about how ES had a boring sideways consolidation day, and how these days usually precede clean trending days, I wrote: “As most know, these types of bases precede the biggest trend moves, and this is likely where we are headed later this week”. It started today, and we put in a 2% green day. These types of basing setups are powerful tools that should be a part of every trading arsenal and I will touch more on this today.
Quite notably, ES broke a losing streak that has been in place since March 28th: For the first time, its put in 3 days of higher highs and closed bullish. Since the late March peak, every-time it has done this it has sold off on the third day maximum, and this is further evidence we have a more sustained relief bounce in play.
I do think this has more to run, but what happens in the next day or two should determine if ES is looking at a more sustained bottom here, or just another dead cat bounce. Today, I’ll get into the pathway I’m tracking and talk more about basing setups