Market In Constructive Near-Term Setup Entering October

Good Tuesday Morning, MPTraders!  October 1, 2024-- Pre-Market Update:  Welcome to October, a month with a split personality seasonal profile for the stock market. Typically (and 2024 has been far from typical), the first half of the month presents heightened volatility challenges. The second half of the month provides "the buying opportunity" ahead of a strong Q4 finish to the year. That said, we have a presidential election during the first week of November this year, so who knows how the stock market will perform during the next 4-5 weeks? 

At the moment, considering the Longshoreman's Union walked off the job at Midnight ET, effectively shutting the major East and West Coast ports indefinitely, equity investors appear to be confident that management and labor will get together well before the port closures impact economic growth and the labor market. 

Indeed, ES is unchanged in overnight trading after yesterday's final hour and end-Q3 vertical thrust from 5756 to 5820 (+1.1%). My attached Hourly Chart shows the late-session upside pivot reversal (white oval), the vertical upmove, and the sideways Bull Flag type of formation that has developed in overnight trading. As long as any forthcoming weakness is contained above 5800, the Bull Flag formation will remain viable, indicating a very constructive near-term setup remains intact after yesterday's upside reversal spike that projects to new ATHs above 5830 toward my next optimal target zone of 5880-5900. 

If 5800 is violated and sustained, the Bull Flag will be invalidated, and ES will be vulnerable to a correction of yesterday's last hour up-spike from 5756.25 to 5820. As long as the 5756.25 low contains additional corrective weakness, my pattern work will retain its bullish structure.

However, a breach of 5756.25 triggers a near-term sell signal in my work that will point to 5700-5710, and thereafter, to 5640/50... Last is 5810.50...