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The yellow levels highlighted at the bottom left of the chart are the primary intraday levels I focus on. To avoid impulsive decisions at poor trade locations, I follow a simple but effective rule: exercise caution when initiating trades outside of these yellow levels.
This means I’m cautious about chasing longs above the Final Upside Target (FUT) and shorts below the Final Downside Target (FDT). It’s important to understand that not chasing does not imply initiating a trade in the opposite direction. Discipline over impulse.
Be sure to review the Weekly Plan for a broader perspective, key levels, and market expectations for the week ahead.
Contextual Analysis & Plan
The conditions are a bit tricky at the moment. The market isn’t doing much, but that’s not uncommon after a significant directional move as it pauses to digest recent gains. The overnight session was largely uneventful, consolidating around 7761 (Smashlevel) (ON VPOC: 7759.75). If sellers could defend 7761, the door was open to clean up more of Tuesday’s poor structure.
The RTH session kicked off with a LBAF of both the previous day’s low and the overnight low, as aggressive sellers were absorbed and subsequently trapped (see Figure 1). During the B-period, buyers attempted to reclaim 7761, but failed to gain acceptance above the level. Sellers then responded and defended 7761 during the C/D-periods, which ultimately led to further cleanup of Tuesday’s poor structure.
Overall, it was a lackluster session, with the auction building value around the 7735 (DT1) level. Today’s session ended the daily one-time framing up, transitioning the market into a 3-day balance. While the broader balance range is defined by Tuesday’s low and Wednesday’s high, the short-term focus is on the developing 3-day value area, highlighted on the chart. This is also reflected in the composite profile, where we can see where volume is starting to build.
Session Recap
After Monday’s and Tuesday’s notable one-sided auctions, the expectation was to transition into a more two-sided trade, which was ultimately today’s outcome. The market continues to clean up Tuesday’s poor structure, with four out of seven single prints now filled.
I’m watching today’s value area in the short term for clues on whether the auction wants to continue cleaning up Tuesday’s poor structure and fill the remaining single prints, or if a 50% retracement of Tuesday’s range will attract buyers. NFP is on deck tomorrow.
Intraday strength would be indicated by a break and hold above 7747 (UT1), today’s afternoon rally high, while weakness would be signaled by a break and hold below 7706 (DT1).
In terms of levels, the Smashlevel is at 7727, today’s VAL. Holding above 7727 targets 7747 (UT1). Acceptance above 7747 would signal intraday strength, targeting 7765 (UT2), with 7784 (FUT) serving as the final upside target under sustained buying pressure.
On the flip side, failure to hold 7727 shifts focus to 7706 (DT1), with 7665 (FDT) serving as the final downside target under sustained selling pressure.
Visual Representation
Levels of Interest
Going into tomorrow’s session, I’ll closely observe the behavior around 7727.
Holding above 7727 would target 7747 / 7765 / 7784
Break and hold below 7727 would target 7706 / 7665
Additionally, pay attention to the following VIX levels: 15.88 and 14.42 These levels can provide confirmation of strength or weakness.
Break and hold above 7784 with VIX below 14.42 would confirm strength.
Break and hold below 7665 with VIX above 15.88 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.
Thank you as always!
Thanks smash !