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Stock Market Waiting For Acceleration Phase

Stock-Markets / Stock Markets 2020 Aug 17, 2020 - 12:48 PM GMT

By: Ricky_Wen

Stock-Markets

Wednesday played out as a gap-up and grind-up type of session, as the bull train remains in full control.

Wednesday closed at 3369 in the ES, near the highs of the session and also at a new closing print high for the week. The entire day’s range was 3382.5-3326.50, including overnight hours. Wednesday was also a full retracement of Tuesday's losses, indicating that the quick backtest into daily 8EMA was stick-saved by the ongoing bulls.


The main takeaway is that given the ongoing momentum and stick saves we see in the indices across the board, we can effectively treat the low of the week as in from Tuesday's 3319.50 backtest in the Emini S&P 500 (ES). As such, today is either a "hold half and go" day or an immediate upside continuation when price action remains trending above our immediate supports.

Some additional highlights of our game plan:

The short-term action is just waiting for the acceleration phase towards 3397.50 as this high-level consolidation is providing the nice and tight bull flag for the continuation model.
A break above yesterday’s high 3382 would be the trigger level for the acceleration phase.
Based on the immediate momentum, when ES keeps sustaining above 3350, then everybody is waiting for 3397.50 ATHs target to be fulfilled.
A break below 3322 would be a confirmation that price action is not ready and something else is playing out because that’s the lows area from the past 2 sessions
Bigger picture wise, the important daily trending support has grinded up to 3280s and is changing as price consolidates/hovers around highs.

In addition, if we look at the other index such as NQ/tech, it has retraced to daily 20EMA in the past 2 days and got sticksaved like clockwork and now grinding towards highs. This means that this is merely just rotation play and tech is likely going to lead the next ramp again as it is now ready

Friendly reminder, four out of four US indices are either hovering at the upper daily bollinger bands or above it since August 7th closing print, so being cautious of another consolidation/mean reversion must be noted or appropriate hedging vs lots of unrealized profits is not a bad idea.

See chart reviews and projections on the Emini S&P 500.

Ricky Wen is an analyst at ElliottWaveTrader.net, where he hosts the ES Trade Alerts premium subscription service.

© 2020 Copyright Ricky Wen - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


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