After a tough trading week for the big benchmark S&P 500 futures contract (ES), we’re seeing potential in the monthly chart patterns for a bullish move.
Not all is in the clear, as the daily chart still shows some challenges that have to be overcome.
But that’s why we continue to follow and research the market and the charts to find the right potential entry levels at the right times for the right futures contracts.
So today, let’s take a look at capitalizing on what we see as a potential bull market run in the ES and unpack what’s happening inside the monthly and daily charts…
The S&P 500 Index (ES) Trade Setup
Here’s how the chart shows the potential gain in ES setting up…
The ES monthly time frame is in an up trend. The market is making higher highs and higher lows.
The market is at a low price hitting a known level of U-turn and just hit a down Fibonacci extension.
All signs are pointing to a bullish push should take place. If the market closes in the sell zone, then I would expect the sellers to keep pushing the market down.
However, the monthly time frame has not closed yet. And with the monthly down Fibonacci extension hit, I am expecting a bullish push back above the known level of U-turn before the monthly candlestick closes.
Now, here’s how the daily chart shows the potentially challenging path for ES…
The ES daily time frame is in a down trend. The market is making lower lows and lower highs.
The market is at a low price and just hit a monthly Fibonacci extension price point of 3,665.25. It is expected the market will have a bullish push towards the down trend line.
When or if the market hits the downtrend line, I can outline the research for the next bearish target assuming the market stays in the bear trend.
As of now, it will be a good idea to stay out of the market and wait for a high price near
the daily downtrend line.
The Bottom Line
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