It’s been a boring day, but what has been happening is that the triangle / bull pennant that broke up yesterday is doing the usual triangle sequence of backtesting the break before the triangle thrust up. After the triangle thrust up ends of course it’s then 90%+ probable that the thrust is fully retraced back to this backtest low.
So is the backtest finished? Maybe, though normally it would go a bit deeper. It may need a little lower before the triangle thrust begins. When the thrust does begin I’d be expecting to see at least a full retest of the all time high on SPX. ES Dec 60min chart:
One thing I’m watching on RUT, now that RUT has made a new all time high, is channel resistance on the channel that formed from the rising wedge on RUT from the February low. That is very much a possible target as ES/SPX makes the triangle thrust and that is currently in the 1322 area. RUT daily chart:
After the triangle thrust is retraced I’d be leaning towards a deeper retracement, though unless something significant changes, my lean is bullish overall for most of the rest of the year.
Stan’s doing a free webinar after the close tomorrow at theartofchart.net on Trading Futures using Non-Traditional Elliot Wave. Well worth attending if you have an interest in TA and if you’d like to come you can register for that here.
