Micro Support Broke - Market Analysis for Apr 16th, 2025
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After consolidating yesterday, we saw the market break below the upper micro support, giving us initial confirmation that we are indeed following the path lower to complete wave (b) to the downside. We have yet to break the low established on 4/10, which would serve as final confirmation. However, the current downside action is supportive of that scenario so far.
I’ll note that there are some issues with the internal wave structure when counting this as wave (b) down. Still, as long as we continue to push lower, this will remain the base case.
Looking at the 60-minute chart, the proportions of this move for wave (b) of the larger wave b are filling out nicely as we move lower today. As mentioned, there are issues with the internal structure of wave c within this (b). That said, if we do continue lower, I believe it's likely to unfold in the form of an Ending Diagonal for wave c of (b), targeting the support zone below. I don't have a high-probability path for the internal structure at this point, so my focus will remain on key support and pivot levels for guidance.
On the 15-minute ES chart, support lies at the 5227 level, which represents the 76.4% retrace of the initial move up off the 4/10 low. A break of this level would provide further confirmation that we are indeed moving lower in wave c of (b). In that case, I’d focus on the larger support zone between 5110 and 4937. As long as that zone holds, I’ll be looking for the larger wave (c) of b to unfold to the upside in the weeks ahead.
If we hold the 5227 level and break back above 5425 and then 5500, it’s still possible we’re working on a larger wave (c) of b up, with wave (b) having already bottomed at the 4/10 low. Under this scenario, we’d also likely be forming a larger Ending Diagonal for wave (c) of b to the upside, as the structure continues to appear corrective. Again, not the cleanest pattern—but with three waves visible in both directions, that’s what we’re left with for now.
Given the unclear internal wave structure, I’m staying focused on the larger-degree support and resistance levels for guidance, as they remain the most reliable aspects of the current pattern. Once we get more wave development, we should have a better sense of the market's likely direction. Until then, my attention remains on those major levels.
