ES Morning Update March 3rd 2025

Very tricky day on Friday but we did put in a lower low into my expected zone and finally ripped to the upside in the last half hour of the day. I was beginning to think we wouldn’t see it and that it would happen on Monday, but now that it’s broken out I do think we have seen a temporary bottom and that we are headed up into Tuesday or Wednesday before we rollover again.

Short term I think we rally up to 6000-6020 before we top out on this first move up, which is likely an A wave of a larger B wave up. If it happens today then I’d look for a pullback of some degree later today or on Tuesday morning, and a final move into the close tomorrow or early Wednesday for the C wave to complete the larger B wave, which could reach 6090-6110 on the ES, but that’s really stretching it.

It might not make it that high though as I think everyone will be looking for it and we all know that if everyone is thinking the same thing it’s not going to happen. The 50% retrace level is at 6007.25 on the ES and 6044.83 is the 61.8% level.

This month of March is going to be a very bearish month and the weekly chart is pointing down hard, so I think the bulls aren’t going to get the move they want so they can short from the perfect spot. Most likely this will be over with by Tuesday, and that’s especially likely if we hit the 50% level today and pullback into the close by some amount, as it’s sets up Tuesday for the move up to the 61.8% level where the bulls will be licking their chops looking for the falling white trendline around 6100 to exit and short it. Plus, the bears will want that level too, but it’s just too obvious I think.

It worked all of last year and into early this year as the bulls had the support of the weekly chart pushing up, so short squeezes retraced 78.2% commonly, but we are in a bearish month now and the weekly chart is NOT supporting any strong rallies, as it’s very bearish looking to me. By stopping the rally this Tuesday, at just above the 2/26 high (6023) and the 2/27 high (6011), those bear stops will be taken out, but the 2/24 high (6067) won’t be, and that’s high enough to keep the bulls long looking for higher prices and bears will be afraid to short it.

It’s the perfect setup for a top before the next move down happens with very few bears short and lots of bulls long. That zone of 6040-6060 on the ES is where I think this rally stops. I don’t think we see it all today but by the close on Tuesday I think this rally is over with. I would love to see it reach the falling white trendline around 6100 but I just don’t think they will give traders that good of a spot to short.

Time is everything and “time” will run out by Wednesday at the latest this week. The next move down should last into late March and will likely reach (probably take it out) the 200 day SMA (5753) on this next drop.

Have a blessed day.