ES Daily Plan | June 30, 2023
The market has nearly traversed the range of the inside week, following the look below and fail earlier in the week.
Will buyers succeed in forming an outside week up? Tomorrow we have the PCE data release pre-open.
Contextual Analysis
In the overnight (ON) session, the buyers wasted no time in filling the excess area from the previous day, sustaining the upside momentum generated during yesterday's closing session. However, the previous day’s high remained intact during the Asian hours, and the market reversed back towards the Smashlevel of 4419. During the European hours, the market managed to breach the excess high, but shortly before the opening of the RTH session, a substantial liquidation break occurred.
The initial three periods of the RTH session were characterized by “choppiness”. However, it is important to note that choppiness alone does not imply that the market is untradeable, it just demands a great deal of discipline. During this time, the sellers diligently defended the excess, while the buyers remained engaged, responding to every sell attempt below 4419. The A-period bounced off yesterday’s VPOC, making it a weak reference. Upon observing the chart, it becomes evident that poor/weak references below are lining up, effectively illustrating the sellers' overall lackluster performance throughout the week. The D-period breached the 6-day balance high; however, buyers were unable to test the resistance area ranging from 4451 to 4441 following a failure above the ON high. The E, F and G-period made higher highs with notable delta divergence. Consequently, an afternoon pullback ensued, leading to a retest of 4419 where buyers emerged. During that sequence, there was notable order flow activity at 4425, which is worth observing going forward. To maintain their directional conviction, the buyers would like to hold that area ranging from 4425 to 4419.
Today’s value was cleanly higher, and just like yesterday, the market rallied and closed at the upper end of the M-period (last 30 minutes of RTH). The daily is back to one-time framing up mode following a breach of the multi-day balance area. The market has nearly traversed the range of the inside week, following the look below and fail earlier in the week, and there is potential for an outside week up with a close above 4449. Tomorrow we have PCE data release pre-open, as well as the end of the quarter (EOQ).
For tomorrow, the Smashlevel (Pivot) is 4425, which represents a level where notable order flow activity was observed in today’s session. Holding above 4425 would target the resistance area from 4441 to the unfilled gap at 4451, located in the upper end of the highlighted inside week. Break and hold above 4451 would target the Weekly Extreme High of 4470. Note the HVN in close connection. Break and hold below 4425 would target the prior Smashlevel of 4419, which essentially is today’s afternoon pullback low and as you know, the short and medium-term value. Break and hold below 4419 would target the last downside target of 4400, which is poor/weak.
Going into tomorrow's session, I will observe 4425.
Holding above 4425 would target 4441 / 4451 / 4470
Break and hold below 4425 would target 4419 / 4400
Additionally, pay attention to the following VIX levels: 14.20 and 12.88. These levels can provide confirmation of strength or weakness.
Break and hold above 4470 with VIX below 12.88 would confirm strength.
Break and hold below 4400 with VIX above 14.20 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.
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.
ES Weekly Plan | June 26-30, 2023
🟥 Daily: OTFD | Ends: 4408 🟩 Weekly: OTFU | Ends: 4381.50 🟩 Monthly: OTFU | Ends: 4062.25 Weekly Extreme High: 4470 Weekly Extreme Low: 4305 As usual, a detailed daily plan will be published tomorrow.
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.
Appreciate the write up Smash. Quality. Never taken for granted. Thank you.
Very weak structure below, but buyers will try to push this as high as they can. Today eoq, next week is much shorter because of July 4th.