Yesterday went pretty much as I'd hoped on ES. The low was a test of 1491 area support, and the high was at the ideal right shoulder high in the 1500 area, holding under the 50 HMA on an hourly close basis. The quality of the H&S forming on ES is still looking pretty good, albeit that ES is now trading back above the 50 HMA, and this bear setup has a decent shot as long as ES can stay under 1500. The H&S target in the 1476 area is also an excellent fit with a test of the SPX daily middle bollinger band in the 1480 area:
Some stats for you today from the excellent and free Stock Trader's Almanac Blog. Today is the first day of February and the stats for today are very bullish, with Dow and SPX up 9 out of 10 of the last ten years, and Nasdaq up 8 straight years. This is another reason to feel doubtful about the bearish setup on ES and SPX here. January closed up, so the January Barometer says we should close the year up, and STA say that the January Barometer is right 88.9% of the time, which is a lot. I did mention in late December that the sharp fall then suggested that the January Barometer might well close bullishly and thus it has been. SPX closed up 5% in January, and since 1950 following a January with a 4% gain or more, February finished flat (less than 1% gain) or down 68.4% of the time.
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