ES Daily Plan | June 10, 2024
The daily chart has returned to balance following Friday’s session, which broke Thursday’s low and ended the daily one-time framing up.
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.
Visual Representation
Contextual Analysis
The daily chart has returned to balance following Friday’s session, which broke Thursday’s low and ended the daily one-time framing up. Note the location of the current 2-day balance area: within Wednesday’s upper distribution, indicating that the trend day formed after the inside day breakout remains intact. While Friday’s session printed a new ATH, it retraced during the closing session, leaving an excess high.
Buyers remain in control by staying within Wednesday’s upper distribution, aiming to negate the excess high and continue the price exploration higher. On the flip side, sellers aim to return within Wednesday’s lower distribution, leaving the excess high intact and potentially opening the door for weakness.
For tomorrow, the Smashlevel (Pivot) is 5358, representing both the previous 3-week balance high and the prior ATH. Break and hold above 5358, signaling strength, would target 5375, as well as the prior Weekly Extreme High of 5390, effectively negating the excess high in the process. Holding below 5358 would target the lower end of Wednesday’s upper distribution at 5337. Acceptance below 5337 would then target a return to the medium-term value (20D VPOC) at 5323.
Levels of Interest
Going into tomorrow's session, I will closely observe the behavior around 5358.
Break and hold above 5358 would target 5375 / 5390
Holding below 5358 would target 5337 / 5323
Additionally, pay attention to the following VIX levels: 12.78 and 11.66. These levels can provide confirmation of strength or weakness.
Break and hold above 5390 with VIX below 11.66 would confirm strength.
Break and hold below 5323 with VIX above 12.78 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.
Clear and concise! Thank you. Curious, how many trades do you average per day or however you think about it? Do you limit yourself on how many L trades you’ll take before calling it a day?
Thank you, buddy! Let's have a green week!