ES Daily Plan | March 5, 2024
Today’s session saw a look above the previous week’s high and fail, leading to a return within Friday’s range. I will continue to use the 5139 level as a short-term reference.
Visual Representation
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.
Contextual Analysis
During the overnight session, trading activity remained muted, mainly consolidating within the upper end of Friday’s session. Aggressive sellers managed to explore prices below the Smashlevel of 5139 during the European session; however, this break was short-lived.
The RTH session was largely uneventful, except for the final three periods. This type of price action following an emotional day prior is not uncommon, as the market processes the breakout. Change took place in the K-period, as buyers attempted to establish another trend day, cleaning up Friday’s poor high in the process. However, this attempt above the previous week’s high resulted in a failure, leading to a return to the high-volume area established over the past two sessions. Sellers were unable to achieve a 30-minute close below 5139 throughout the entire session, except during the M-period, which marks the final 30 minutes of the RTH session.
Today’s session saw a look above the previous week’s high and fail, leading to a return within Friday’s range. Now, the pivotal question is whether this failure will trigger weakness, or if the market will continue to establish value higher, serving as a bullish indication in the context of Friday’s breakout from balance. Keep a close eye on buyers' ability to shift the short-term value (5D VPOC) higher, currently at 5078, indicating acceptance.
I will continue to use the 5139 level as a short-term reference to gauge the market's strength or weakness. Holding below would open the door for a retest of the previous ATH at 5123, with the weakest response involving a return within the prior multi-day balance area. Conversely, a failure to hold below 5139, which suggests a lack of interest in filling Friday’s breakout structure, would signal strength. 5165 and 5182 remain the upside targets.
For tomorrow, the Smashlevel (Pivot) is 5139, representing Friday’s I-period single prints. Break and hold above 5139 would target the previous week’s high at 5149. Acceptance above 5149 would target an upside continuation toward 5165 and the final upside target of 5182. Holding below 5139 would target the previous ATH at 5123, coinciding with Friday’s halfback. Acceptance below 5123 would target Thursday’s spike base of 5106.
Levels of Interest
Going into tomorrow's session, I will observe 5139.
Holding above 5139 would target 5149 / 5165 / 5182
Break and hold below 5139 would target 5123 / 5106
Additionally, pay attention to the following VIX levels: 14.06 and 12.92. These levels can provide confirmation of strength or weakness.
Break and hold above 5182 with VIX below 12.92 would confirm strength.
Break and hold below 5106 with VIX above 14.06 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.
Thank you buddy! Scalped a few times and waited for a breakout which was short-lived.