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E-Mini, SPX Pullback Is Necessary

Published 07/28/2016, 08:48 AM
Updated 01/11/2024, 05:37 AM

Even the FOMC did not give the market a push to try for a new high, and price is still stuck in the same multi-day range. E-Mini S&P 500 failed to go above 2168 and is now testing an important Gann line (the one that supported post-FOMC bounce).

This article is complementary to our previous post.

E-Mini 4H Chart - July 28, 2016
E-Mini 4H Chart

If wave v is indeed completed than E-Mini needs to slide towards wave ii target below 2140 and test previous resistance - now support.

E-Mini 1H Chart - July 28, 2016
E-Mini 1H Chart

In the 1H chart, we have labelled both possible scenarios and the bullish one is the green. Now, ES is testing Gann line and a close below that would open the road to the next support - 2145.

Now, price is at 62% retracement of FOMC low and today's high.

How to turn bullish?

A close below 2156 would make it difficult to expect another new high soon, but the only way this turns bullish is if wave v is an ED.

  • We have post-FOMC rally with a-b-c up (wave 1),
  • the pullback now a-b-c down (wave 2).
  • If 2152 holds then market might rally to try the upper-bound of the purple channel.

S&P 500 1H Chart - July 28, 2016
SPX 1H Chart

SPX chart has the same outlook and support for wave 2. Support includes:

  • Gann lines
  • Green bound
  • 200SMA - black line


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