EDUCATIONAL: Rectangle Breakout

Today ES experienced a classical Rectangle Breakout. If you examine the Friday’s closure on the hourly chart, you can see that the price closed precisely 50 pips above the rectangle upper boundary that was defined by the previous ATH. And it closed with a decisive bullish candle. The setup was complete on Friday and today’s gap up just confirmed the market’s intent. The channel seems to be defined, the pennant that ES was working on the whole last week is complete. Three simple measurements give us the the target for wave 3 and two targets (that are very close) for wave 5.
The length of wave is expected to reach 3.0-3.272 fibs off October 30 low.
Price target: 3958-3975.
Timeline: November 27 – December 4

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