Wednesday was spent backing and filling the previous profile generating an overlapping, narrower value area and less volume than Tuesday. Sellers are in control on the daily timeframe.Yesterday I said that the 840 area should limit upside on Wednesday. ES only managed 836.25 on the high.837 to 840 is a major zone of resistance (1/2RangeX2). ES spent all day yesterday consolidating below that zone which is bearish.
Until effective buyers re-emerge on the profile I’ll only look to short. As long as ES remains below 837 I’m expecting that we’ll see a new low for the week.
I’m sure many traders are monitoring the support trendline off the November low that comes in around 818 today. Should we see a break below that level it could well bring in a new wave of selling and this time (unusually) the obvious “go with it” choice will most likely be the right one.
