V Stoch almost reached 75 at about 2:30 PM and started rolling over while sell line remained above buy line so shorted ES @ 1183.75. Original trading rules look for a reading above 75 but it was awfully close (72.8) so I went with it. Strong run up since this morning's lows with an apparent 5 wave count and overbought conditions on my 5 minute charts, if anything we should see a retrace of that run to make the short ES profitable. However, on Buy/Sell Vindicator the sell line dropped towards an ascending buy line at end of day. If the buy line crosses above the sell tomorrow I will either cover the short ES or move the stop to a breakeven or better position.
From an EW standpoint, the drop from Tuesday's high into this morning's lows looks very much like 5 waves, although a tad sloppy. Same pattern is evident on the SPX and looks much cleaner. However, the move up today looks very impulsive (and also much cleaner) which confuses matters. Supporting the argument for today's rally being a 2nd wave is the underlying market statistics: on the NYSE volume dropped off a tad and, more to the point, advances and declines were almost even. So not a lot of real strength in the underlying technicals. We should know the answer early tomorrow.
