ES Daily Plan | December 4, 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 remained within Monday’s range, while sellers attempted to gain traction below Monday’s low during today’s RTH session. Multiple attempts below Monday’s low ultimately resulted in no follow-through, forming a poor low. This highlights the current weak state of the sellers and underscores the difficulty of fighting the prevailing context of buyers firmly in control. Buyers have successfully shifted the 5D VPOC (short-term value) higher from 6015 to 6062—a bullish indication within the context of Friday’s move from balance. Value continues to follow price, and only a return to the prior 3-day balance area introduces the potential for change.
In a prevailing uptrend, any failed attempt by sellers to shift momentum signals that the upward trend is likely to continue, creating opportunities for buyers to step in. Conversely, in a downtrend, failed attempts by buyers to shift momentum provide openings for sellers. Many inexperienced traders fall into the trap of trying to pick tops or bottoms (i.e., predicting where the trend will reverse), rather than focusing on failed attempts to reverse the trend. Generally, “counter-trend failure”—when sellers fail in an uptrend or buyers fail in a downtrend—provides stronger, more reliable setups for entering the market in the direction of the prevailing trend.
Another quiet session in the books, with the market accepting higher prices after Friday’s directional move. The last three sessions are merged on the chart, highlighting the current distribution of interest. The current ATH is poor.
In terms of levels, the Smashlevel is at 6064. Holding below this level would target a traverse of the current distribution toward 6051-45, with a final target at the support area between 6025 and 6015 under sustained selling pressure. Failure to hold below 6064 would target an upside continuation toward 6080, with a final target at 6095 under sustained buying pressure.
Levels of Interest
Going into tomorrow's session, I will closely observe the behavior around 6064.
Break and hold above 6064 would target 6080 / 6095
Holding below 6064 would target 6051-45 / 6025 / 6015
Additionally, pay attention to the following VIX levels: 14.08 and 12.52. These levels can provide confirmation of strength or weakness.
Break and hold above 6095 with VIX below 12.52 would confirm strength.
Break and hold below 6015 with VIX above 14.08 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.
95 anybody?!
Thanks and agree!