ES Morning Update May 17th 2018

0
494

 

Looking at the charts this morning I think we had a wave 4 down on Tuesday, then started the wave 5 up yesterday. Wave 5's are usually 5 wave patterns inside them, or just a straight single wave. Breaking it down into those smaller waves I think we had the wave 1 up and 2 down on Tuesday, then the 3 up yesterday, leaving the 4 down happening right now. If they can turn this back up at some point today and rally up into the close then that should be the smaller wave 5 up to complete the 5th pattern.

It would be great to see them close that 2750-2755 gap zone with the 5th wave but that's yet to be known. Possibly they chop all day on this smaller wave 4 down inside 5 up and push out the 5 of 5 up until Friday? From a tricky point of view that would certainly be one as then they could gap it down over the weekend for the open on Monday with everyone stuck long.

It's unknown how they are going to play this out but my gut tells me they won't fill that gap on this current rally up from the 2592 low but instead sell off and delay the filling of the gap until the next trip back up, which that time I suspect it will go through it and keep going. But who knows when that "next time" will be?

For now I'm just looking for a move up today to complete the smaller wave 5 of the 5th wave, and a green close on the market up near that high. Give me those two thing.... say +5 points SPX or more at the close, and I'll be a bear into Friday. Otherwise I'll be just watching as I need the proper setup to happen to increase the odds enough for me to take the trade. Without it I'd just be gambling and I've done plenty of that already with little success.