ES Morning Update January 3rd 2024

Yesterday showed a great start for the bears but the failure for them to hold the lows is not good. For the nasty drop to play into late next week we need today to be down heavy. I think we need a 100 point (or so) down move to get this move back on track to reach the 4250-4350 zone that I’m looking at in the time period I think it should unfold in.

If we don’t see it start today then another pattern will likely be in play. It will then chop into the week of OPEX and then produce that big drop into end of January. Now I’m not leaning that way but it’s possible, so I’m just pointing it out. I still lean toward the 4250-4350 zone being hit by the end of next week.

Again though… we need to see a breakdown below the low from the 20th very quickly. What we could see it a series of down moves (like yesterday) with small bounces into the close where we “stairstep” down for 3-4 days and then have a big limit down day at the end.

And that’s still by the end of next week, but the pattern is more sneaky as every move lower bounces back up smaller but it keeps the dip buyers in their longs thinking we are bottoming. But if this pattern plays out the last drop will be HUGE and have them all in a panic mode. All the scenarios though still point to a nasty down move coming this month.

Have a blessed day.