The S&P futures (ES) have traded within a constricted range over the past three days. We are waiting for the market to leave this range. It can spend more time here, but the overnight market indicates that the S&Ps may be ready to move out of the consolidation today. Watch for increased volatility and the potential for trend day conditions today.
Levels to watch:
- a break above 1338 to the upside. There are no nearby resistance levels until we get above 1400, so if the market does break to the upside, we have the potential for clear sailing for a while.
- a drive below 1324 to the downside. This would bring us back into testing the trading range from late February to early March that formed the apex (blue triangle) on the chart.
Even if the market does break lower, the wave structure and higher time frames continue to be bullish, so longer term, I still see further upside in this market.
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