ES formed a falling wedge into Monday’s low and broke out upwards from it yesterday. But it had the minimum required touches on the wedge sides, so you’d usually see the price move sideways here, often in a megaphone (green scenario), before making a decision on which way to break out longer term.
Right now I still expect a wild megaphone right shoulder on the potential head and shoulders on the ES chart, and I still expect that to lead to a new all-time high.
But this is the scenario I’m worried about, and why I keep talking about 1987:
That scenario becomes a lot more likely if the price makes a lower low here without immediately starting to move up to pass this morning’s high. The lower low should not go very far.
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