ES Daily Plan | March 18, 2025

Key Levels & Market Context for the Upcoming Session.

Mar 17, 2025

For new followers: The yellow levels highlighted at the bottom left of the chart 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

Contract Rollover

A quick reminder: I’ve transitioned to the ESM25 (June) contract. For reference, I do not back-adjust my charts. I recommend marking 5640 (ESH25 settlement) on your chart, as roll gaps often tend to get filled.

Contract rollovers often create confusion. While some traders choose to back-adjust their charts, I prefer to leave historical levels unchanged, resulting in a visible roll gap on the chart. This choice is a matter of personal preference—neither approach is inherently superior, as both have their advantages and disadvantages. For short-term traders, the impact is minimal since we navigate the market day by day, and my weekly targets remain the same regardless of the method used. I generally scale back activity during rollover periods, as order flow becomes noticeably less reliable.

Contextual Analysis

The overnight session saw early weakness, leading to a test of the initial downside target at 5660. After multiple failed attempts by sellers to gain traction within Friday’s (ESM25) lower distribution below 5660, buyers took control of the auction following the European session open. The VIX came close to its resistance level of 23.04 during this sequence (HOD: 22.95).

The RTH session opened below Friday’s spike base at 5692, kicking off with an immediate impulsive move higher that quickly tagged the initial upside target at 5721 during the A-period. This level, marked as “intraday bullish if above,” proved difficult to reclaim. Aggressive buyers were absorbed around the 5721 level during the A-period, triggering pullbacks. During the B-period, buyers made their third attempt to reclaim 5721, retesting the area where notable order flow activity was observed; however, sellers held firm. The impulsive A-period move left behind poor structure, and the market spent a couple of periods filling this area down to the opening level. In the process, the 5692 level was retested, where buyers emerged. The F-period ended the intraday one-time framing down, allowing buyers to gain momentum. The I-period decisively breached the 5721 level, and the final intraday upside target at 5750 was tagged shortly thereafter.

Interesting sequence from the Initial Balance (IB).

Friday’s double distribution trend day was followed by another one today, as buyers successfully defended Friday’s (ESM25) spike base at 5692—our key level. Change took place in the I-period, as the market extended the initial balance to the upside, forming single prints—a key area to monitor in the short-term. The strongest response would involve holding within the upper distribution above 5726, favoring continued upside. Failure to do so would open the door for a traverse of the lower distribution, potentially revisiting the 5692 level.

In terms of levels, the Smashlevel is at 5726, where change took place today. Holding above this level would target 5756, with a final target at 5786 under sustained buying pressure. Conversely, failure to hold above 5726, would open the door for a revisit of 5692, with a final target at 5660 under sustained selling pressure.

Levels of Interest

Going into tomorrow's session, I will closely observe the behavior around 5726.

Break and hold above 5726 would target 5756 / 5786
Holding below 5726 would target 5692 / 5660

Additionally, pay attention to the following VIX levels: 21.72 and 19.30. These levels can provide confirmation of strength or weakness.

Break and hold above 5786 with VIX below 19.30 would confirm strength.
Break and hold below 5660 with VIX above 21.72 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.