ES

The equity markets had a strange day. Big swings back and forth. Range came in at 22 handles, while volume was huge.

Based on my interpretation, we finished minuette (ii) down and then traced out a sub-minuette i and ii waves. Should this be correct we are setup for big upside day tomorrow.

I got my deep corrective, as we retraced 78.6% of (i). In the process, we actually busted the channel, but quickly regained it.

Notice that we came close to the same channel on the wave ii retrace. This is an important channel. We need to maintain this support for a continued bullish view.

We now have upside targets based on the initial structure of minute [v]. iii = 161.8% of i at 1075.75, while the 261.8% of i is at 1093.50. (iii) = 161.8% of (i) at 1089, while the 261.8% of (i) sits at 1118.50.

Someone mentioned the possibility of a bigger triangle setting up in eChat today. I looked at this scenario last night and came to the conclusion that it is possible, however, the leg up from the 1035.75 L clearly traced a 5 wave structure.

Remember, triangle legs are always 3's. I suppose this could be a "cheater", which does happen, regardless of what the purists say. It's possible, just low odds imo.

I got myself a slug of October 103 SPY calls this morning near the lows. They shook me out of 1/2 of them for a $.55 profit, but I still have plenty to take advantage of a very bullish (i)(ii) , i-ii scenario - should this play out.

It appears that the KoolsTools cycle low came in as expected.

Any trade below 1041.50 is cause for concern. I will dump my calls should we trade through that level. Although not a deal breaker for the bullish case, it severely wounds it.

Bottom line - I'm near-term bullish. Structure suggests we have higher price ahead. Should my assessment be incorrect, I will change my strategy accordingly.