S&P 500 / ES / MES New All Time High Breakout or Trading Range?

The S&P 500 reached a new all time high last week, leading many to believe the bull trend is still intact and the market is strong. However, this is not necessarily the case. Look at what happened the past 3 times prices reached this level - strong bulls and strong bears sold. Although the rally up from the 2400 low has contained strong buying pressure, prices are still in the developing stages of a bull flag trading range. The bears want a strong reversal down from the wedge reversal. The next reversal attempt by the bears would make a second entry for the wedge reversal (Apr 29 selloff was first attempt). The bulls want a strong breakout above the all time high and a measured move up. Most likely, there will continue to be profit taking around this level and prices will continue to go mostly sideways as a trading range forms, until there is either a strong bull breakout, or a strong bear reversal.

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