Crossing a Range is Easy 11/21/23

[DrStool]

Clearing resistance is hard. The rally has crossed a range, parts of which the market has repeatedly traded through over the past 7 months. That tends to clear the range of both bids and offers, leaving a thin market that can be traversed easily. 

Now we've reached the hard part, the top of the range. Traders who have bought and held through this rally will enter their sell orders near the top of that range. Dealers will attempt to pre-empt them. Bears will start shorting near the highs. Buying momentum will begin to wane as the market has become extended and overbought. 

I'll illustrate this with a daily chart of the ES, 24 hour S&P futures. 

So we can expect the rally to end any day now. What happens after that, I will leave for the longer term Technical Trader analysis. Before the market opened yesterday I thought that there was Room to Run. Now we'll see. As our old friend LeeWhee reminded us, the more resistance is tested, the weaker it becomes. Now we'll find out if they have the powell to continue probing the resistance enough to weaken it for a subsequent breakthrough. 

Here, our focus is on the day to day, so let's return to the usual look at the hourly chart of the ES.  The 5 day cycle has entered a down phase after hitting most projections. There's a band of spport around 4535 40 that will give us an idea of whether this down phase will go down in absolute terms or just go sideways as a consolidation before the next attempt to break out. 

 

For moron the markets, see:

• Swing Trade Screen Picks – Holding Those Longs November 20, 2023
• Room to Run November 20, 2023
• A Rally Can’t Live on Hope Alone November 20, 2023
• Gold Has Lost Its Mojo and Is Now in Danger November 14, 2023
• Swing Trade Screen Picks – Loading Up on Buys November 13, 2023
• Meltup Gonna Take You Hiya  November 13, 2023
• Fuggedaboutit! Treasury Supply Ain’t Going Away November 5, 2023
• Which to Believe, the BLS or Actual Tax Collections November 3, 2023

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[SiP]

5600 on spx

cup and handle by BofA

[DrStool]

This is how it starts. Profits are taken. Doubts creep in. 

Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning. 

[DrStool]

No, this is not the end.

[DrStool]

Another test of trend spport coming up. 

[DrStool]

Need to clear 4540 to reverse the pullback. 

[fxfox]

46 minutes ago, DrStool said:

No, this is not the end.

Churchill?

[DrStool]

Ya wohl. 

[DrStool]

11:30 levitation hour. 

[fxfox]

Could it be the beginning of the beginning of the beginning end before it even begins?

[PullMyFinger]

11 minutes ago, fxfox said:

Could it be the beginning of the beginning of the beginning end before it even begins?

If you want to put a specific time frame to it, if I understand this correctly, it's either 4 weeks and 3 days, or 9 weeks and 5 days. 😉

 

[fxfox]

3 minutes ago, PullMyFinger said:

If you want to put a specific time frame to it, if I understand this correctly, it's either 4 weeks and 3 days, or 9 weeks and 5 days. 😉

 

😂😂😂

[Jorma]

I just saw on YouTube that if you buy 10 shares of Tesla you will become a millionaire. Is there going to be a stock market by the time Musk is president of the Republic of Texas, or X? If so then could be.

[DrStool]

Never short a dull market. 

 

[DrStool]

Actually, markets are often dull at the tippy tippy top.