12:13 pm EDT:  This week’s trend of stocks being unable to rally off neutral to bullish news has continued this morning as the 9:55 am Consumer Sentiment was at the upper end of expectations, yet the ES has fallen after posting a nominal new contract high (1038.75) on the open.  We are no longer looking to buy at the daily pivot (1025.50) and instead would wait for the ES to climb above 1033.00 again before attempting a long.  If the ES can move below 1025.50 with a pickup in volume, we may look for shorts, but very carefully as the markets in general appear to be consolidating for a breakout (either today or early next week). 

The nominal new contract high and reversal downward in the ES this morning coincided with a precise bounce in the 30 Year T-Bond future off the 61.8% support retracement level of this week’s range.  As we write, the 30 Year has now retraced 61.8% of the move from yesterday’s high to this morning’s low.  Gold too reversed downward off long term trendline resistance after advancing strongly earlier.  All in all, the precise technical consolidation taking place among the various markets should be a warning.  There will probably be a few fakeouts and false starts that will sucker in new longs or shorts prior to the ultimate move being made.