ES Daily Plan | December 10, 2024
My preparations and expectations for the upcoming session.
For new followers: The yellow levels highlighted at the bottom left of the chart 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
In the previous plan, I included an additional visual emphasizing Friday’s afternoon rally high, where notable aggressive buyers were absorbed. The overnight session tested this area early on and encountered sellers. Another attempt to regain the Smashlevel of 6104 occurred during the European session, which was also met with selling activity. The second rejection led to a test of the initial downside target at 6090, which provided a bounce pre-open.
The RTH session opened within Friday’s range, with the A-period being rather uneventful. Change took place in the B-period, as sellers managed to break 6090, ending the daily one-time framing up—sellers' primary objective. This was accompanied by the VIX breaking its resistance level at 13.46, signaling a need for caution on the long side, especially given the potential signs of buying exhaustion and the risk of liquidation breaks previously discussed. Single prints formed in the B-period and remained unfilled, providing an additional clue to exercise caution. The second downside target of 6078 was tagged in the C-period, followed by the final downside target of 6066 being reached in the D-period—a favorable area for profit-taking. The latter, representing the unfilled gap, provided a solid bounce; however, buyers struggled to regain the 6078 level, which was marked as "intraday bearish if below." Given the elevated VIX, it was logical to expect sellers to defend the 6078 level to maintain downside pressure, which they ultimately did, resulting in new lows during the closing session.
Today’s session experienced a liquidation break, resulting in a b-shaped double distribution profile—a development aligning with the potential signs of buying exhaustion previously discussed. The gap at 6066 was filled in the process. Monitor for continuation: acceptance below 6062 would maintain downside pressure, while failure to do so could open the door to cleaning up today’s single prints.
In terms of levels, the Smashlevel is at 6062. Holding above this level would target the resistance area between 6083 and 6090, with a final target at 6104 under sustained buying pressure. Failure to hold above 6062 signals weakness, targeting the prior ATH at 6045, with a final target at the support area between 6025 and 6015 under sustained selling pressure.
Levels of Interest
Going into tomorrow's session, I will closely observe the behavior around 6062.
Holding above 6062 would target 6083 / 6090 / 6104
Break and hold below 6062 would target 6045 / 6025 / 6015
Additionally, pay attention to the following VIX levels: 14.94 and 13.44. These levels can provide confirmation of strength or weakness.
Break and hold above 6104 with VIX below 13.44 would confirm strength.
Break and hold below 6015 with VIX above 14.94 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
Make sure to review the Weekly Plan, which provides a broader perspective and highlights key levels of interest to observe in the upcoming week.
Thank you, buddy! A fantastic way to kick off the week ahead.
Thanks! The levels were spot on. It’s shaping up to be an interesting rest of the week with the poor high still intact.