ES Daily Plan | December 13, 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
The overnight session was relatively uneventful, holding below 6090 and thereby rejecting Wednesday’s initial balance extension. We came down and tested the initial downside target at 6076 following the PPI data release, a level marked as "intraday bearish if below." Buyers managed to defend 6076 during both the overnight session and much of the RTH session; however, they ultimately failed to reclaim the 6090 level, making the RTH session tricky to navigate.
The RTH session was characterized by responsive two-sided activity, with buyers attempting to gain traction above the initial balance and sellers attempting to gain traction below 6076. This price action was unsurprising, given the multi-day balance area the market is currently in, with both the 20D and 5D VPOCs situated within it. The afternoon session favored sellers, who extended the initial balance to the downside, ultimately tagging the final downside target at 6062 during the M-period (the last 30 minutes of RTH). I marked an area from Tuesday’s session where sellers are potentially trapped, given how Wednesday’s session rejected Tuesday’s weakness. Areas with trapped participants can provide bounces when retested, as these traders, still holding their positions, may exit the market. Since 6062 was today’s final target, it was interesting to see whether a reversal would unfold; however, 6062 was ultimately tagged in the closing session.
Multiple attempts to gain traction above the initial balance range ultimately resulted in an extension to the downside and a close back within Tuesday’s range, specifically in the area where a lot of aggressive selling took place. Immediate attention is on monitoring the closing weakness for continuation. Overall, the market is in a multi-day balance area, coiling for a potential directional move.
In terms of levels, the Smashlevel is at 6063. Holding below this level would target the prior ATH at 6045, with a final target at the support area between 6025 and 6015 under sustained selling pressure. Failure to hold below 6063 would target today’s VPOC at 6076, where both the monthly and weekly VWAP are situated. Acceptance above 6076 would open the door for a test of 6090, with a final target at 6103 under sustained buying pressure.
Levels of Interest
Going into tomorrow's session, I will closely observe the behavior around 6063.
Break and hold above 6063 would target 6076 / 6090 / 6103
Holding below 6063 would target 6045 / 6025 / 6015
Additionally, pay attention to the following VIX levels: 14.84 and 12.98. These levels can provide confirmation of strength or weakness.
Break and hold above 6103 with VIX below 12.98 would confirm strength.
Break and hold below 6015 with VIX above 14.84 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.
Great setups into the close this afternoon.
Thanks pro Smash! I suspect you have a crystal ball.