The ES trendline that I posted on Monday night was key support yesterday, and survived the day unbroken. There was significant positive divergence on the RSI and MACD on the hourly chart for the last two lows and ES has duly broken up. The key test for me is whether ES can clear the important support/resistance level at 1068. If it can then we may see a significant bounce here:
If not then we should expect that declining trendline to be hit again, and today it would hit at a low enough level to deliver a new low without breaking below the trendline. There is strong support there and that might just be enough to finish the fifth subwave of this very long wave 1.
Many of the EW analysts are now agreeing that this has all been one big wave down and the obvious count to me for that wave seems to be this::
I see that Attila at Xtrends is calling for a big down day today. That could well be right. The risk certainly seems to be to the downside and I'm expecting to at least see a new low during trading hours before this long wave down is finally completed.
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