The e-mini futures moved down by stair-steps all through the day session Monday. The price remains inside the first wave of the major declining wave 3. So buyers are standing aside.
Today is the last day of August. We may see a small consolidation from yesterday’s declining move or an attempt to make a little bounce. But as long as price stays under 1059, any small bounce will not change the current downtrend. Instead the reaction to a small bounce will be an opportunity for ES to break through the key support at the 1036.50-35.50 range and move lower toward July’s low.
Trading strategy for Tuesday
Today we could see one of two scenarios. If ES gaps down at the opening but holds above the key support at 1036.50, we are likely to see some shorts covering. That could push the price back up to 1043-45 or higher to 1050-49 (short entry).
If ES gaps up the open, but does not break through the 1058-59 range (short entry) the price should go sideways inside the 1058- 1038 range to complete the last day of trading for August.
ESU0 Intradya chart
