Recap ES made it to the open gap fill above early in the week as expected. Since then consolidation for the Fed minute release on Wed. From there Y-0 was breached decisively leading to a drop to below Y-1. That opened the door to breakout target Y-3 and below. Closed the week near Y-4 and week low.
Outlook More downside likely but a bounce is due. One week with 130 points range is rare in recent history. This means majority of the active traders will not know how to react to the situation because they have never seen one in their trading career.
Consolidation around B-1 is expected with the potential of a huge squeeze back up to Y-2 / B-0 possible. The breakout of new high in volatility on Friday points to more wild swings in the card. Trade with caution.
S&P 500 Aug 24 to Aug 28 Outlook
Lawrence’s Comment
ES made it to the open gap fill above early in the week as expected. Since then consolidation for the Fed minute release on Wed. From there Y-0 was breached decisively leading to a drop to below Y-1. That opened the door to breakout target Y-3 and below. Closed the week near Y-4 and week low.
Outlook
More downside likely but a bounce is due. One week with 130 points range is rare in recent history. This means majority of the active traders will not know how to react to the situation because they have never seen one in their trading career.
Consolidation around B-1 is expected with the potential of a huge squeeze back up to Y-2 / B-0 possible. The breakout of new high in volatility on Friday points to more wild swings in the card. Trade with caution.
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