ES Daily Plan | June 27, 2024
ES Daily Plan | June 27, 2024
The overall context remains unchanged, with the consolidation still intact following another session of trading within the value of the current multi-day balance.
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 momentum from Tuesday afternoon's session carried into the overnight session, with buyers continuing to drive prices higher. This resulted in a test of the highlighted resistance area between 5546 and 5556, where sellers were active. Prices were sharply rejected, leading to a significant 30+ handle reversal. This provided good opportunities for overnight traders targeting reversals at the upper end of the highlighted blue area on the composite volume profile to the far right, which represents the value of this current multi-day balance area.
During the RTH session, trading largely remained within this highlighted value area after sellers' attempt to break the initial balance low in the D-period was rejected. This look below and failure of both the initial balance low and the overnight low was notable due to the delta divergence observed on the lower lows, coupled with aggression from buyers. I will provide a visual of this on Substack for reference.
The session was quiet overall, with prices holding below the Smashlevel of 5529 in the morning session and above it in the afternoon session. In the last 30 minutes of RTH, known as the M-period, there was a squeeze that tested the resistance area once again; however, the session ended up closing back below the spike base. The medium-term value (20-day VPOC) has shifted higher from 5322 to 5531, which serves as a bullish indication in context of the prevailing uptrend. Value continues to follow price.
The overall context remains unchanged, with the consolidation still intact following another session of trading within the highlighted blue area, which represents the value of the current multi-day balance. As a general rule, the longer a consolidation phase lasts, the more significant the subsequent breakout tends to be. In the event of acceptance outside the value area, we have carried forward the overnight ATH at 5588 as a target on the upside, and two sets of single prints from the trend day on the 17th as potential targets on the downside.
For tomorrow, the Smashlevel (Pivot) is 5542, representing today’s M-period spike base. Holding above 5542 would target 5556, as well as Thursday’s opening level at 5570. Acceptance above 5570 signals intraday bullish momentum, targeting the final upside target of 5588, marking the ON ATH. Break and hold below 5542 would target the afternoon pullback low of 5527, as well as the 5515 level. Acceptance below 5515 signals intraday bearish momentum, targeting the 5497, effectively filling the remaining single prints from 6/17.
Levels of Interest
Going into tomorrow's session, I will closely observe the behavior around 5542.
Holding above 5542 would target 5556 / 5570 / 5588
Break and hold below 5542 would target 5527 / 5515 / 5497
Additionally, pay attention to the following VIX levels: 13.10 and 12.02. These levels can provide confirmation of strength or weakness.
Break and hold above 5588 with VIX below 12.02 would confirm strength.
Break and hold below 5497 with VIX above 13.10 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.
Great stuff! Thank you!
can we arrange a 1-1 ?