As widely anticipated we got the wedge breakout; however the nature of the break has not been similar to the previous. It is very typical for wedge breaks to retrace the entire duration of the swing from the inception of the pattern.
We have a very difficult environment for Fed / NFP combo. With only crumbs left on the plate to chase higher, it is clear the meat of the move is in a pullback.
Even the biggest bulls on the street are going to require a pullback after Fed to allow time for loading purposes. In simple terms, a pullback is a healthy play and unless we see any updates on the macro side from Fed (for example as markets are only pricing a 25bp, a 50bp would be enough to short-circuit the risk flows).
To the topside the only level to track is 3,040.8 which is the ABC sequence target for this 5th wave. If we break above it will look impulsive in nature whilst to the downside confidence will increase as we begin trading under 2,954.
Highly recommend all to track this chart for Fed, and best of luck those in live positions.
We have a very difficult environment for Fed / NFP combo. With only crumbs left on the plate to chase higher, it is clear the meat of the move is in a pullback.
Even the biggest bulls on the street are going to require a pullback after Fed to allow time for loading purposes. In simple terms, a pullback is a healthy play and unless we see any updates on the macro side from Fed (for example as markets are only pricing a 25bp, a 50bp would be enough to short-circuit the risk flows).
To the topside the only level to track is 3,040.8 which is the ABC sequence target for this 5th wave. If we break above it will look impulsive in nature whilst to the downside confidence will increase as we begin trading under 2,954.
Highly recommend all to track this chart for Fed, and best of luck those in live positions.
