ES Daily Plan | April 30, 2024
While buyers struggled to gain upside momentum above the previous week’s high, they successfully defended the important 5125 level, maintaining short-term control.
For new followers, the yellow levels highlighted at the bottom are the primary levels that I focus on intraday. My strategy for preventing impulsive decisions at unfavorable locations involves following a simple yet effective rule of exercising caution when initiating trades outside of the yellow levels. This implies that I am cautious chasing longs above the final yellow upside target and shorts below the final yellow downside target. It is crucial to understand that refraining from chasing a trade is not an automatic invitation to initiate a trade in the opposite direction.
Visual Representation
Contextual Analysis
The strongest response would involve maintaining above 5125, which the market achieved today following a relatively quiet session. The overnight session saw a gap above Friday’s after-hours activity, with trading mostly occurring at the upper end of Friday's range. The RTH session opened with a very minor gap, which was quickly filled. This was followed by a bounce that quickly led to a test of the initial target at 5154, completing the cleanup of the H-period single prints from the session on 4/15. The test of the middle distribution from 4/15 resulted in selling activity, triggering a pullback that was subsequently picked up by buyers.
The greater part of the session was characterized by responsive two-sided activity within the initial balance range. Buyers struggled to achieve upside momentum above the previous week’s high, and sellers were unable to capitalize on this lack of momentum. However, a liquidation break occurred in the L-period, testing and quickly rejecting the important 5125 level, which provided an opportunity for a trade back to value.
While buyers struggled to gain upside momentum above the previous week’s high, they successfully defended the important 5125 level, maintaining short-term control. The break above the previous week’s high marked the end of the weekly one-time framing down. The last two sessions have established a distribution between 5125 and 5151, which is now our key short-term area of interest. Acceptance above 5151 would continue the ongoing objective of cleaning up the poor structure from 5/14. On the flip side, sellers need acceptance below 5125 for potential weakness to develop.
For tomorrow, the Smashlevel (Pivot) is 5151, representing today’s value area high (VAH). Break and hold above 5151, signaling strength, would target 5174, as well as the prior 3-week balance low of 5194 in the case of continued strength. Holding below 5151 would target fills of today’s L-period excess toward the important level of 5125. Acceptance below 5125, signaling potential weakness, would target the short-term value (5D) at 5105.
Levels of Interest
Going into tomorrow's session, I will closely observe the behavior around 5151.
Break and hold above 5151 would target 5174 / 5194
Holding below 5151 would target 5125 / 5105
Additionally, pay attention to the following VIX levels: 15.28 and 14.04. These levels can provide confirmation of strength or weakness.
Break and hold above 5194 with VIX below 14.04 would confirm strength.
Break and hold below 5105 with VIX above 15.28 would confirm weakness.
Overall, it's important to exercise caution when trading outside of the highlighted yellow levels. A non-cooperative VIX may suggest possible reversals i.e trade setups.
Weekly Plan
Be sure to check out the Weekly Plan, which provides a broader perspective and highlights significant levels of interest to watch in the coming week.
Disclaimer: Futures and options trading involves a high level of risk, with the potential for substantial losses. The information provided in this newsletter is for informational purposes only and is not intended to be a trade recommendation. It is the responsibility of the reader to make their own investment decisions and they should seek the advice of a qualified securities professional before making any investments. The owners/authors of this newsletter are not certified as registered financial professionals or investment advisers.
Amazing levels thank you
Thank you, buddy! Solid levels as always.