ES Daily Plan | July 22, 2025
Market Context & Key Levels for the Day Ahead
— For new subscribers
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 ES Weekly Plan | July 21-25, 2025 for a broader perspective, key levels, and market expectations for the week ahead.
Contextual Analysis & Plan
“A strong market would either ignore Friday’s poor low altogether or show little interest in Thursday’s lower distribution if that area is revisited.” The overnight session completely ignored Friday’s poor low, suggesting that Friday’s price action was driven more by weak longs being flushed than by stronger sellers taking control. The initial upside target at 6343 (UT1) was quickly tagged, where price briefly stalled before a full traverse of Thursday’s upper distribution unfolded. For patient buyers, the market offered a pullback toward the 6343 level ahead of the RTH open, where buyers were active.
The RTH session, which opened above Friday’s lower distribution—an area marked by notable aggressive selling (see delta profile)—kicked off with a squeeze that printed new all-time highs, cleaning up the overnight ATH (6357) in the process. The final upside target was 6375, essentially tagged during the initial balance (IBH: 6372.50). Note the relatively wide initial balance range of 28 handles, highlighted by a white vertical line along the daily profiles on the chart. A wide IB typically sets the stage for rotational activity if the market struggles to gain traction outside of the IB range. The interesting nuance here was that the final upside target was right at the initial balance high, raising the question: how appealing was it to chase a potential IB extension? Not very, in my book. If we weren’t interested in chasing longs, what did we want to see to be part of potential shorts playing a reversal? That’s right—aggressive buying effort failing to push price higher (absorption), followed by aggressive sellers stepping in. Contextual awareness is the most important factor in trading. I’ll share a visual on Substack illustrating how today’s price action above the initial balance range appeared from an order flow perspective (see Figure 1).
A squeeze to tag all intraday targets (FUT: 6375), followed by balance and a closing flush to new intraday lows, made for quite a start to the week. The key now will be to monitor the closing weakness. A “weak” market will remain within last week’s range, targeting high volume nodes, while failure to do so would open the door to cleaning up today’s unfinished business at the highs.
In terms of levels, the Smashlevel is at 6355—the M-period high, coinciding with last week’s high. Holding below 6355 would target the support area between 6332 and 6323 (DT1). Acceptance below 6323 would signal weakness, targeting the HVN at 6304 (DT2), with a final downside target (FDT) at 6289 under sustained selling pressure.
On the flip side, reclaiming and holding above 6355 would target the poor high at 6374 (UT1), with a final upside target (FUT) at 6400 under sustained buying pressure.
Levels of Interest
Going into tomorrow’s session, I’ll closely observe the behavior around 6355.
Break and hold above 6355 would target 6374 / 6400
Holding below 6355 would target 6332-23 / 6304 / 6289
Additionally, pay attention to the following VIX levels: 17.54 and 15.78. These levels can provide confirmation of strength or weakness.
Break and hold above 6400 with VIX below 15.78 would confirm strength.
Break and hold below 6289 with VIX above 17.54 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.
Awesome stuff, I wish you had a live trading group. It will be worth it for sure
You're the man Smash!