ES Big Fib Overview 02/05

Well here we are at what seems like a never ending rise  Each day brings gentle rises and as we saw Friday some big sudden ones too.  However it is rare that we get to bring into play BIG fibs.  I define Big as something that takes years to develop.  The last truly BIG fib we got to play with was 1187.35.  It had the proud distinction of being the 61.8 retracement fib from the landslide from October 07-March 09.  When we broke it in August the next stop was of course the 50% fib from the same series 1076.88.  Between August we bounced in between the two through October.  The 50% held as did the 61.8 which launched us into our current move.

So here we are now at the biggest fib of all in my mind.  The 78.6 from the same big slide, being 1344.64.  Write that one down.  Its that big.  Its enormous.  And its not the first time we have been here.  In May 11 we got there.  The world was good.  Since July the previous year we had ground our way up.  On Monday the 2nd of May we actually busted through it to 1556.50 or 12 handles past bud couldn't close there.  The next pass failed on July 8th.  One more feeble attempt on July 22nd came up short and the writing was on the wall. The next move was to 1065 a drop of 371 handles.  Ouch.

I guess the world is good again. And its promising that we have naturally worked back off of the 50% and the 61.8 to get here again.  Money is flowing.  Endlessly it seems.  QE in full force.  Bonds and Vix at lows so it should surprise nobody we got here again.  The question is what from here.  What are the Fibs that make sense as speed bumps, floors and ceilings.  So we should examine what the biggest fibs on the board are and use them as markers.  

As I said earlier write this one down.  1344.64/78.4%/R.  There is no bigger fib in our future.  Now on the low side and I will work my way down.  1324.05/78.4%/R from the same big move that created our 1344.64.  1319.75/100%E/NovL/DecH/DecL.  1278.48 and 1272.29.  I list the two together because they are close in price and both 61.8E from the July and December Extensions.  To be quite honest I am surprised we have not seen them again yet, but I'm not convinced we wont and with a slide I see them as our first real support level.  Above us on the high side and I would encourage you to write these down in red somewhere.  If we have a punch outside a band and it corresponds to one of the upper extension fibs you have a high chance of seeing a reversal at that spot so be on the lookout at these:  1353.30/127%E/NovL/DecH/DecL.  An even bigger number above is 1363.00.  Big.  Really BIG.  1363.00/100%E/OctL/OctH/NovL.  Lastly 1367.21/138.2%E/NovL/DecH/DecL.  Honestly we do not hit another long term fib as it stands now until we see 1396.54.

Its hard for me to think that 1344.64 gets dealt with so easily, but if your in the camp that is bullish your top or at least a temporary one is likely to come at 1344.64, 1353.30,1363.00 or 1367.21, with your support being at least for now at 1324.05,1319.75 and the two together at 1278.48 and 1272.29.