ES Morning Update September 29th 2020

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The market did indeed hold the early gains yesterday and continued higher into the close. It looked and felt like a wave 3 up of some degree, which was why I thought it had staying power and wouldn't rollover much (or any) yesterday and would save the small pullback for today, which seems to be happening in the futures right now.

It's probably a small wave 4 down with a small wave 5 up afterwards. If this plays out today then my best guess would be that those 5 small waves will complete a medium wave 1 up inside the large wave 5 up that should be in play now. This assumes the low is in and I'm leaning toward that being the case now that we are so far away from it and near the end of September. Anything is possible but odds now suggest that we won't make another lower low in the coming days.

Wednesday should be the pullback day I still think, as we'll probably finish the small wave 4 down today and the small wave 5 up into the close, which again should complete medium wave 1 up and leave medium wave 2 down to start tomorrow.

The falling light blue trendline should still act as support so if we do drop tomorrow I'd look for it to do an ABC pattern for this medium 2 down and likely bottom on Thursday. How far will pullback is unknown as I just don't get the feeling it's going to go very deep. Again, it feels like they got the bears trapped and shook out the bulls late last week, so I'm thinking smaller pullbacks are more likely then deeper ones.

But let's first see what today brings us before trying to figure out tomorrow. I'm looking for a tiny ABC down for the small wave 4 down early today and the small wave 5 up into the close to complete the medium wave 1 and allow medium 2 down to start Wednesday. Have a blessed day.

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