ES Bottom Line: both my pattern and momentum work argue that the overnight spike low at 3803.50 (triggered by the BOJ rate cap expansion... relaxation of yield curve control) has the right look of the completion of the entire downleg from last Tuesday's CPI high at 4180.
That said, while the setup is in place for a recovery (Santa?) rally into year-end, ES needs to climb to inflict some damage to the dominant downtrend, which will occur at the successively higher resistance levels demarcate on my attached chart.
For starters, however, ES needs to climb above 3863/65 to gain significant near term upside traction.
The inability of ES to climb above 3863/65 leaves it vulnerable to a retest of 3803 (down to a 3790 allowable "undershoot" of 3803), but if violated and sustained, the 3740/50 is on the table... Last is 3842.00...