Market Analysis for Dec 7th, 2022

Dec 7, 2022 - 8:59 AM EST

Overnight ES rejected at 3954 against the trending resistances. As of writing, price tested against the important 3912-3920 support and bouncing back into 3930s on first try basis.

After the RTH open, watch for 2 scenarios to execute

1) break and hold below 3912-3920, opens downside continuation into 3885/3865/3850 (trend day)

2) unable to break 3912-3920, opens oversold bounce to backtest 3950/3960/3980 resistances (range day)

Remember, it’s been 4 days down consecutively and yesterday got into extreme oversold territory That means where the countertrend bounces get rejected will be telling.

Context from last night: https://www.elliottwavetrader.net/trading-room/post/8207853

Intraday trading parameters:
Short-term remains bear biased given the breakdown below 4000 weekly LIS
Key levels tomorrow will be 3960/3980 trending resistance and 3912-3920 support to scalp against
Biggest concern we need to be aware of is a potential rangebound day if cannot take out 3920-3912after RTH open
Break below 3920-3912 opens 3885/3865/3850 immediately

Ricky Wen is an analyst at ElliottWaveTrader.net, where he writes a nightly market column and hosts the ES Trade Alerts premium subscription service.

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