Wednesday, October 27, 2010
Here is an hourly chart showing 24 hour e-mini trading. Yesterday I thought that the market was headed up to 1200 from its early 1174 low. But instead sellers took control of the market overnight and today the ES has dropped as low as 1168.25 so far.
This drop from the 1193 high looks like another normal reaction in the uptrend from the late August low at 1037. There have been several corrections of 25-30 points since then. The 1165 level is support because there the ES would match the size of its last drop (blue rectangles) and reach the lower boundary of the trend channel I have drawn.
I expect the market to make a low in the green oval target zone and then begin a swing up to 1200.