ES Triangle

ES has Formed a Little Triangle Since the January 6 High & will Likely Morph it Into a Larger Triangle All the Way to the Orange Rising Megaphone Bottom

ES has Formed a Little Triangle Since the January 6 High & will Likely Morph it Into a Larger Triangle All the Way to the Orange Rising Megaphone Bottom

ES has formed a little triangle since the January 6 high.

You know how triangles work–after the first one completes, it breaks a little through one side or the other to form a larger triangle. ES will probably do that here as it continues to work its way sideways to the orange rising megaphone bottom.

ES would typically break that bottom a bit before continuing its move up into the left shoulder of a head and shoulders top for the orange rising megaphone.

After breakout from the orange rising megaphone, ES must retrace to its bottom at 2150 before a likely move to another new high.

10-Year T-Note Potential Inverse H&S

ZN is Massing Against the Neckline of a Potential Inverse H&S

ZN is Massing Against the Neckline of a Potential Inverse H&S

The 10-year t-note is massing against the neckline of a potential inverse H&S.

Usually when you see this kind of massing, the price will break out through the neckline. Usually the breakout is clean and the price keeps moving up. Occasionally the breakout will lead to more sideways as a triangle right shoulder morphs into a megaphone right shoulder.

ZN has Formed the Black Megaphone and would Usually Retrace to the Megaphone VWAP Before Breaking Out Downwards

ZN has Formed the Black Megaphone and would Usually Retrace to the Megaphone VWAP Before Breaking Out Downwards

ZN has been working on the black megaphone since the fall of 2014. Usually ZN would retrace to the megaphone VWAP (volume-weighted average price) before breaking out downwards.

The black megaphone is comprised of a series of smaller megaphones (red and aqua) across VWAP and could itself be part of a larger formation, like a big topping triangle. That means we could see more megaphones inside megaphones across VWAP to complete the larger formation before a downwards breakout.

ZN Got Up Here Via a Series of Rising Megaphones (Aqua & Orange)

ZN Got Up Here Via a Series of Rising Megaphones (Aqua & Orange)

ZN got up here via a rising megaphone (aqua) that extended with another rising megaphone (orange) up its bottom.  It failed to put in a clean top within the orange rising megaphone.  That suggests that some larger topping pattern is forming with this extended sideways move before ZN returns to the bottom of the aqua rising megaphone.

ES Rising Megaphone Update

The Pink Megaphone within the Orange Rising Megaphone is Legal for a Breakout Upwards

The Pink Megaphone within the Orange Rising Megaphone is Legal for a Breakout Upwards

ES has completed the pink megaphone on its 60-minute chart and looks about ready to break out into a run at 2300.

The green scenario would be a classic way of completing the orange rising megaphone before a retrace to its base at 2150.

Alternate scenarios would have ES putting in a quick drop to 2200 to redraw the bottom of the orange rising megaphone before continuing higher.  And once ES gets going upwards, it could melt up all the way to the orange rising megaphone top before starting to top.

Neely is Looking for a Big Move Down Coparable to the Green Scenario

ES is Likely to Head into the Head of a Head and Shoulders Top After the Dip to 2150

ES would likely head up into the head of a small head and shoulders top for the move out of the 2016 low after the likely dip to 2150.

Gold Price Channel

Gold has Confirmed the Red Price Channel on its 60-Minute Chart & is in Its Critical Decision Wave

Gold has Confirmed the Red Price Channel on its 60-Minute Chart & is in Its Critical Decision Wave

Gold has confirmed the red price channel on its 60-minute chart and is in the channel’s critical decision wave. That’s where the channel usually either starts a top or breaks out into a melt-up.

The Melt-Up Scenario Could Retest the July High or Even Break Gold Out of the Big Blue Megaphone While a Top Here Could Lead to Further Consolidation or a Trip to the Big Blue Megaphone Bottom

The Melt-Up Scenario Could Retest the July High or Even Break Gold Out of the Big Blue Megaphone While a Top Here Could Lead to Further Consolidation or a Trip to the Big Blue Megaphone Bottom

If gold starts a top here it could be the top before a crash to the bottom of the big blue megaphone gold has been forming since late 2014. That would be a crash to buy.

A breakout into a melt-up could target a retest of the July 2016 high or even an upwards breakout from the big blue megaphone.

A top here could also lead to a prolonged period of megaphoning across 1200 to morph the big blue megaphone into a triangle. The triangle could break out in either direction but would be a favorite to break out downwards to take gold down into the 700s to put in the final bottom for its correction off the 2011 high.

QQQ Extended Rising Wedge Top

QQQ is Forming an Extended Rising Wedge Top

QQQ is Forming an Extended Rising Wedge Top

QQQ is working on a rising wedge top (navy blue) on a price channel top (blue) for a large rising wedge top (red) that it’s been working on for almost a year.

Once an extended rising wedge breaks out downwards, the move down is usually fast.

QQQ is Working on a Top for this Wave within the Navy & Orange Megaphones & Needs a Retrace to at Least the Navy Megaphone VWAP at Roughly 100

QQQ is Working on a Top for this Wave within the Navy & Orange Megaphones & Needs a Retrace to at Least the Navy Megaphone VWAP at Roughly 100

The red rising wedge is a topping pattern for this wave up within the navy blue and orange megaphones in the long-term chart above.

The red rising wedge is also completing the head of a head and shoulders top for the silver rising megaphone.  That H&S top is a strong favorite to break the price out of the silver rising megaphone to at least the bottom of the blue rising megaphone.

The bottom of the blue rising megaphone will be a long-term critical decision point.

QQQ could bounce off the bottom to take out the high of the right shoulder of the silver rising megaphone’s H&S, turning that right shoulder into a megaphone.  A megaphone in this spot would likely launch another interior megaphone across the navy megaphone VWAP (Volume-Weighted Average Price) to put a big continuation triangle in the blue rising megaphone for a move to new highs (purple scenario).

The green scenario represents a retrace to the orange megaphone VWAP to complete it before taking QQQ down to the navy megaphone bottom and breaking it out of the blue rising megaphone.

QQQ would then retrace to the navy megaphone VWAP and blue rising megaphone bottom for the big decision on whether to put in a trip to another new high vs crash to the blue rising megaphone bottom.

IWM is Back at its 3-Year Megaphone Top

IWM 3-Year Megaphone

IWM is Back at its Pink Megaphone Top & Needs to Put in At Least a Good Stab at a Retrace to VWAP

IWM is back at its pink megaphone top and needs to put in at least a good try at a retrace to its VWAP at 112 before continuing much higher.

The faster it puts in that retrace, the more likely it is to reverse there or above there and go a lot higher (orange and green scenarios).

If IWM breaks through the pink megaphone top and spends a long time forming a topping pattern there, it’s more likely to crash all the way to the pink megaphone bottom (purple scenario) after.

The chart looks in transition to me from a market that expected to top here to a market that now wants to extend a lot higher.

ES Price Channel Kills Melt-Up Set-Up

ES has Returned to the Bottom of its Red Price Channel, Killing a Potential Melt-Up Set-Up

ES has Returned to the Bottom of its Red Price Channel, Killing a Potential Melt-Up Set-Up

On Friday, ES confirmed a price channel and left a potential melt-up set-up on the chart for the weekend.

But overnight, ES returned to the price channel bottom, killing that melt-up set-up. That means ES has either put in the first wave of a topping or continuation pattern (green scenario) or it will take another step up the channel before the start of that pattern (purple scenario).

ES is working on a top for the orange rising megaphone.  Rising megaphones usually complete with a head and shoulders top before breaking out into a fast move to the formation bottom.  When they don’t complete that way, the price usually megaphones for an extended period at the top before the retrace.

ES is a strong favorite to make another substantially higher new all-time high after the pullback to the orange rising megaphone bottom at 2150.

Potential Little ES Price Channel

Potential ES Price Channel (Red) would be Heading Into Critical Decision Wave

Potential ES Price Channel (Red) would be Heading Into Critical Decision Wave

ES has set up a potential price channel (red) on its short-term charts. It needs a new high within the channel to confirm. A new high within the channel would put ES in the channel’s critical decision wave for a breakout into a melt-up (green scenario) versus the start of a top (purple scenario).

ES could also morph the price channel into a rising megaphone by moving sideways to break the channel bottom a bit before a new high.

Or it could collapse before a new channel high for a trip down to the bottom of the pink flat-topped megaphone to redraw the orange rising megaphone bottom a bit.

Longer-term scenarios remain the same.