ES Daily Plan | February 9, 2024
Given the unchanged context, the game plan remains the same, focusing on observing Wednesday's upper distribution. Its upper end has unfinished business in the form of a weak high.
Visual Representation
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.
Contextual Analysis
The short-term playground outlined in the previous plan was Wednesday’s upper distribution. Today, both the overnight and RTH sessions remained within this range, resulting in a rather uneventful trading session.
The key takeaway from today's session is that the market continues to accept higher prices, as demonstrated by the shift in short-term value (5D VPOC) from 4967 to 5012. Given the unchanged context, the game plan remains the same, focusing on observing Wednesday's upper distribution. Its upper end has unfinished business in the form of a weak high. Buyers are aiming for a breakout, targeting 5040 and 5056, while sellers aim to return within Wednesday’s lower distribution (<4999), targeting the unfilled gap at 4978.25.
For tomorrow, the Smashlevel (Pivot) is 5018, representing the upper end of Wednesday’s upper distribution. Break and hold above 5018 would target an upside continuation toward 5040, as well as the final upside target of 5056. Holding below 5018 would target the upper end of Wednesday’s lower distribution at 4999. Acceptance below 4999 would target today’s unfilled gap at 4978.25.
Levels of Interest
Going into tomorrow's session, I will observe 5018.
Break and hold above 5018 would target 5040 / 5056
Holding below 5018 would target 4999 / 4978
Additionally, pay attention to the following VIX levels: 13.32 and 12.28. These levels can provide confirmation of strength or weakness.
Break and hold above 5056 with VIX below 12.28 would confirm strength.
Break and hold below 4978 with VIX above 13.32 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.
Thank you 🌼
Thank you, buddy! Tough day but green at the end of the day.