They took ES down as expected through its critical 1897 level last night. That means this correction was bigger than the last significant correction, and that means the Sornette bubble is in the middle of a 4-6 month topping pattern.
They also took ES through the bottom of its 2-year+ rising wedge in a brief fake breakout that got bought.
ES is now back at the VWAP of its gray bottoming megaphone.
The reentry into the 2-year+ rising wedge after the fake breakout was a set-up to get long. But they may take it down one more time to give SPY a fake breakout and complete a falling wedge on ES (green scenario on chart). Then you could go long on an upward breakout from the falling wedge.
You can also go long on a breakout through the highlighted orange trend line on the chart, or on a breakout upwards through the navy blue megaphone VWAP at roughly 1920.
The next wave up could top in the ES 1950-1965/SPY 195-196.80 area or it could go all the way to one final new all-time high. Either would meet the rules of everything going on in the chart. I like the new all-time high scenario only because it makes sense in poker terms. There’s a short-squeeze there for the taking, big money still needs to complete switching sides, and I think they’ll go for it.
We should see this wave up cling pretty tightly to the bottom of the 2-year+ rising wedge and we would usually see a couple more false breakouts through that wedge bottom before the real one.