ES Morning Update March 22nd 2024

Yesterday before the open there was a FP on the QQQ at 443.44, which the last time it was hit the prior day and then we turned back up and rallied strongly. So that suggests we will go back up again to hit my FET of 5334 soon. Will it hit today or Monday… I don’t know? I’ll just say I’m very nervous here trying to short this super strong market. Here’s that FP…

So everything has to line up perfectly today (or Monday) for me to risk a short. While I know it’s coming I’ve been taking longs for a month now on pullbacks and have been doing great, so going against the trend is never easy. I really feel like just sitting in cash to see if it happens or not? Going long on a pullback (or correction) is much easier then trying to nail the top. Do I think it will pullback? Yes… but I don’t know for certain how much or when. I really have to be cautious here, that’s all I’m saying.

What would give me more courage?  A really strong move up to show exhaustion.  I don’t think it will happen today, but it’s possible I guess.  I lean toward Monday having some last rally to say 5375-5400 on the ES.  That would really fool a lot of people to see that happen on Monday I think.  I know my FET is at 5334 on the ES and 5296 on the SPX, but a pierce of them of 30+ points would be wonderful to short.

But past history doesn’t show that much of a move as commonly happening.  Most of the “pierces” were 10 points, maybe 20?  However, on a percentage basis that amount of points back then, if repeated now, could be 30 or 40 points.

Lastly, I will add that I did take a short yesterday with the intention of just playing the FP on the QQQ… meaning I was just looking for a small pullback to hit that FP and then I’d look to exit and wait for that last rally up to 5334 where I’d look to re-short, if everything lines up and I have the courage.

However, Fed Chief Powell is speaking again today (oddly, as it’s just after the recent FOMC), so the top could already be in?  Of all the Fibonacci Extension Targets that I researched (back to 2020) about half of the FET’s pierced through and the other half fell shy.  We got within 20 points or so yesterday, so maybe it’s already topped?

It’s just not easy to know at this point because it’s so close to the target that it might be done.  I’ll just have to watch the RSI on the 2hr and 6hr chart to see when it gets oversold, and the FP on the QQQ too.  Currently the 2hr RSI could be oversold at some point today if we pullback just a small amount.

Now the 6hr RSI, and of course the daily, could take a long time to get oversold… especially the daily.  Really a tough call here.  Again, I took a short but I don’t know if it’s just going to reach and pierce the FP on the QQQ, or if the top is in and we are starting the correction now.  We’ll see.

Have a blessed day.