Stop Panicking and take Advantage of the Ichimoku Pull Backs! Yesterday, we had a down day and everyone was talking negative. Why? Are the markets about to crash? No is the answer. When the markets were making high’s, everyone was saying it is too dangerous to buy now and they will wait for a pull back. Now that a pull back is occurring, everyone is scared! This is gambling i.e. when you trade with emotions. Allow the charts where people’s action tell you what is going on.
Let’s examine the charts now and see what is really going on.
Below is the Seasonal pattern for the $ES Emini SP500 futures for September from www.alerttrades.com. The statistics show there is a 51% probability of September being bearish with the last two years being bearish. 51% means we are going to swing in a consolidation pattern, not a trend. The last two years, the reward/risk has been around 1:1.
Below is the daily chart for the $ES Emini SP500 futures provided by eSignal. It shows so far, we have had a bullish movement of 0.93% and a bearish movement of 3.17%. Price is in the Ichimoku cloud which indicates we are consolidating. This means, a trader has to be extremely “picky” right now and keep risk low.
Below is the weekly chart of the $ES Emini Sp500 provided by eSignal. This chart clearly shows we are still in a bullish trend holding the support at 2117.00.
In conclusion, we are in a bullish consolidation pattern. There is no need for everyone to panic that the markets are going to crash at all. Right now, as long as we hold this weekly support, price will continue to be bullish.
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