ES Morning Update August 25th 2022

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The 4110.75 low is holding for now and the moves up off it are weak ones as I expected they would be. The RSI on the 6hr chart moved up sharply off the oversold level but again, I don't think it's going to rally hard here. Meaning I would not expect to see the RSI reach extreme overbought conditions, at least not until the first week or so of September when I think the Small Wave 5 up will end.

For today though I'd lean more toward a mixed day where we could see some early strength that fades later in the day. The shorter time frame charts, like the 2hr, 1hr and below are up near overbought but can go up more... which would support an early push higher that fades later as they rollover it. Mixed charts make it hard to figure out of course as we have those short term ones overbought, the 6hr still pushing up, the daily neutral but weak and the weekly neutral but providing support.

Let's talk a little about the weekly since there's not much else to cover for the short term. The MACD's dropped to a level where they were equal to the low in 2020 and the RSI reached oversold too but made a "higher low" then 2020.

Of course we know that the market ripped higher after the 2020 for over a year until it topped this January. The weekly chart re-confirms to me that the lows are "in" for this years 6 month correction, and this is all just what I see in the technicals. Of course if you add all the codes I discovered and talked about in my special report post several weeks ago then you have an overwhelming about of items that confirm this.

All of this put together gives me a lot of confidence that the next time we go back down to retest that June low, which I think will be late September after the FOMC meeting, we will make a higher low.

And it should be a scary one that sucks in a ton of bears that can be squeezed for the Medium Wave 3 up that will follow. I'm only guessing at the target of 3800 based on the rising red trendline being in that area at the end of the month. It can certainly pierce it and all the way down to within a point (or less) of the 3639 low.

But it should NOT break as the FP on the SPY was hit on June 16th to confirm the low is "in"... and yes I know it went a little lower on the 17th before it bottomed. I explained that in the "codes" post I did. Today's market is much more volatile then the market years ago, so targets (whether they are from FP's or movie date codes) can be overshot... which is what happened I'm sure.

The codes on the tops don't usually overshoot as they are going up on very light volume and can barely reach it it seems. But the down moves are on heavy volume and can carry over a little in both price and time. In the "codes" post I show an image from the movie "The Purge" that said the date 3/21/2020, which was the planned date for the low back then, but it overshot by 2 days as we know.

I didn't pay attention to that code back then before the crash, even-though I did see the movie and knew about it. Interesting to note the movie was about "purging unwanted people" and that's exactly what the vaccine is doing with the FAKE COVID Virus. Anyway, the point here is that we are still on track to grind until the first week or so of September to complete the final Small Wave 5 up, and therefore end Medium Wave 1 up. Then we should drop in an ABC to a low somewhere above 3639 and probably below 3800 into the end of September. Have a blessed day.

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