3530-3600 is in the Cards for ES 8/11/2020

This is the ES at the daily view.

Time to look at the bigger picture. Every solid red, blue, or purple line is a historical support or resistance stemming from 2002-2017. Each line played a vital role in the ES over time and recently.

Currently, there is no significant resistance until that last red line at the top. That was the historical resistance stemming from 2009 and was the resistance for the previous all-time high.

If you track the ES over the months, it seems that we have been in a giant megaphone pattern since 2011. From where we are in the upward channel, high liquidity levels, and where the historical resistance is... I do not see a possible correction (10% or more) until we reach that top historical resistance (last red line).

We may see a decent pullback at the previous all-time high. However, liquidity levels are too high for a significant pullback - even though the markets are primed for a correction. Remember, TIME is more important than price. Liquidity levels take weeks to go down to weaker levels. Right now, liquidity hasn't been since high since November 2019.

Judging by the trajectory of the upward channel to the red line, it may reach there between mid-September to late November. That should give enough TIME for liquidity levels to start settling down. After all, liquidity cycles end eventually.

The PPE reports came out today. Higher than expected. Bonds may rise due to the fear of inflation. If there are multiple strong signals of inflation, then the Federal Reserve will have to cut back on its money printing.

That said, I wouldn't hold my breath for a crash anytime soon. It's more likely that we grind our way to 3530-3600 with some small pullbacks in between. It's more likely that we see weaker liquidity levels closer to November due to the time factor.