ES Morning Update August 16th 2017

Looks like we our lower high forming now on the MACD’s of this 60 minute chart, which will create our negative divergence.  All we need is for the price level to squeeze out a little higher high then the 2473 recent high.  It could have truncated with this premarket mornings 2471.25 high?  Hard to say for sure.  We have the FOMC minutes reading of last months reading today at 2pm, so we could see some chop until then (with a downward bias) and then another move higher?  Today is a tough one I can clearly see we are setting up for a move down as the charts tell me so.  Even the 6 hour chart shows its’ MACD line now above zero and contracting toward each other… mean they could rollover too.  But I’d still like to see a little more on the upside before shorting.

Shorting yesterday just didn’t produce much downside and I mentioned that in the chatroom as well.  It was a small short near the open but it was a one day move as well.  The next short should be more then one day and much deeper, but I’m a little concerned about shorting on a Fed Day as those gangsters never like to be blamed for anything and commonly hold the market up for another couple of days before it drops, and then they blame it on some other news event.  That suggests Friday could be the best day to short, but again, that’s all based on past history of Fed Days over the last few years.  Charts tell me something different.  They suggest that any move up into the 2475-2480 range should be shorted.  So if we see that today then I’m a bear… if not, then I’m just going to nibble on small quick trades “in and out” until a better short appears.

Only this future chart shows that it’s ready to rollover today, and all that is needed is a higher high (preferably into the 2480 area).  The SPX Cash Index is lagging behind and could be stretched out until Friday if the Fed’s want to do so.  Some nice negative divergence could be setup on it by then for sure.  Of course that doesn’t mean we won’t go down before then. It only “suggests” that any move down will be short lived and reversed at some point.  So if we rollover right at the open and drift down today then I think it will just be part of the B wave down with the A wave up being the 2430 to 2473, leaving the C wave up (2480 area) for later this week.  If it hit today, then I’d short it.  But if not I’m just in a “don’t know” mode where I don’t have good odds for a strong move in either direction.  And when I have 50/50 odds I just sit on my hands and wait for something better.  That’s what I see for today and possibly the rest of the week.  A move down early… probably just an extension of the B wave, a rally up to 2480 area is a good short and probably ends the ABC up.