OK so this was a good week for me with ES but NQ kept it from being a banner week. The S&P 500 was a fairly easy read but the NQ I just could not get a feel for it. My long term short bias thwarted by constant ramps testing the high of range made the NQ particularly difficult. Ultimately we ended up breaking the low of range then the high and then the low to mid then broke to end the week. Not to mention testing the yearly low multiple times just to balance above and ramp. Man what a week. Now the Friday high close ended up being the Friday dump.
Now as bearish as this looks and feels it has a tendency to get everyone leaning to one side, the short side as of right now, and when that is the case the ES loves to go against popular opinion. A couple things to make me feel a rally is in order… a rally which leads to more sell.
Put yourself an hourly chart together and throw on some Bollinger Bands with a 20 period look back and walk that chart back as far as needed to know that we simply do not live this deep into the bands without some sort of seller profit taking and dip buyers. Now that does not mean we rally to all time highs but we could rally to the hourly mid or just go sideways and drag the mid to us. Just do not think this is going to keep dumping… although it could.
RTY never got that weak. Never even broke range.
NQ broke balance late and finished on the lows but is not on the 2nd StDev.
ES same as NQ where it broke balance but is not technically riding the band.
What does this all mean? Well my long term short bias was satisfied at the end of a green day in the ES and my sell the rally thesis says we are in prime position for a rally that ultimately should sell.
Also remember… we closed on the lows and the low of the year but it felt worse than it was because we ramped hard to start the day. We barely closed under previous days low.
