To borrow a line from George Lucas, the Bears have a “New Hope” as the debut of the 7th Star Wars movie nears its worldwide debut.
Should the /ES (on the continuous chart) break and close beneath its November 16th low at 1998.50 on the daily chart, that price action portends a stronger move lower.
From a Fibonacci perspective the 38.2% retrace from the Nov. 3rd high to the Nov. 16th low, and following failure to retest that lower swing high before rolling over, sets us up for one of two potential patterns:
#1 – The Bat pattern (cue Adam West!)
Completion of this pattern would look for price to re-test the low range of August and September at 1889.50 (rounded up) at the 88.6% retracement from the September low at 1861.
#2 – The Crab pattern (Cue Sebastian from The Little Mermaid)
Completion of this pattern targets a MUCH more bearish level of 1707 (rounded up), which is a 1.618% of the move from the November high at 2110.25 down to the September low of 1861. That happens to be in the range of the high from August 2013.
There is an outside possibility of a third pattern that rarely shows up, called an Alternate Bat (Think George Clooney).
That scenario would target 1828.50 (rounded down), which is a 1.13% of the move from the November high at 2110.25 down to the September low of 1861.
However, Alternate Bat Fibonacci patterns are very rare. Though this one does have the spike low from August 24th in its favor for structure purposes.
