ES Morning Update March 9th 2023

Yesterday we saw the chop I was expecting. Today should be the same but it looks weaker here in the morning, so we could see a move down to 3950 or so early in the day before a move back up later on. That’s just a guess and not a guarantee, which is based on the look and feel of the RSI on the 6hr chart. It’s not something I would try to trade as it might not happen. But there a bear flag formed and negatively aligned short term charts, so it play out.

I would compare it to trying to catch the last 20% of a move as 80& is likely over with now. I’m more focused on the rally back up, which should start on Friday but will likely drag out into Monday I’d think. If it plays out and reaches the 4050-4080 zone again on that day then the following day (Tuesday) should pullback again. However, since it’s OPEX next week I do think that any first move down (like on Tuesday possibly) will reverse back up the rest of the week.

On my wave count chart from Monday I label the expected rally up as Extra Tiny Wave 4 (ET4) and the expected move down afterwards, to the 3700-3800 area, as Extra Tiny Wave 5 (ET5).

Naturally that wave will subdivide into 5 smaller waves. My thoughts are that “if” we top on Monday (4050-4080) then the first drop into Tuesday, and rally back up afterwards, would be a wave 1 down and 2 up of the likely subdividing waves.

They would be labeled as Super Extra Tiny Wave 1 and 2 (set 1 and set 2), which again I didn’t label on the wave count chart from this past Mondays update, but I’ll show them on todays chart. Continuing on… the rest of next week could be choppy as (set 2) lingers area up near the 4050-4080 into Thursday or maybe even Friday to hold the market up during OPEX so both call and an put holders get screwed. It’s a common pattern every month it seems.

The week after that we have the FOMC on Wednesday the 22nd, which is likely where I think we’ll see the 3700-3800 target reached. I suspect we’ll start rolling over some on Friday the 17th and by the time we get to the FOMC we are already into that target zone. Then the usual happens, the Fed say whatever and the market jumps up and down that day but continues to swing wildly (in a bottoming zone) the following Thursday and Friday.

This might carry into the following week too… not sure? But at some point we’ll turn back up and rally into April 10th-15th I think, which will once again be another attempt to break 4100. I don’t think it will, but anything is possible I guess? It will be the top of Tiny Wave 2 (T2) and that should be all she wrote for the bulls. Have a blessed day.