ES Daily Plan | March 7, 2025

Key Levels & Market Context for the Upcoming Session.

Mar 06, 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

Contextual Analysis

The overnight pattern over the past few sessions has been consolidation during the Asian hours, followed by weakness once the European market opens—and today was no different. The support between 5823 and 5813 was lost early on, shifting the short-term focus to sellers, who once again breached Monday’s lower distribution. The final intraday downside target at 5789 was tagged before the RTH session opened, where a distribution was established.

When the RTH session opens below the final intraday target—5789 in today’s case—this level becomes an immediate inflection point, as noted in the pre-open post on X. A weak market would remain below it, ideally with the VIX breaking its resistance at 23.68, whereas buyers needed to reclaim 5789, accompanied by the VIX falling back below that resistance. Whether it’s wise to chase further downside after the overnight session already covered significant ground is a separate question. Regardless, the A-period tested Wednesday’s excess low, where responsive buyers emerged. During the B-period, buyers reclaimed 5789 with the VIX dropping below its resistance, setting the stage for a test of the crucial resistance area between 5813 and 5823, where sellers were waiting. For three consecutive periods, buyers aggressively attempted to break through but ultimately failed, leading to renewed weakness. Remember, trading below 5813 was intraday bearish. Once the market dropped below 5789 during the E-period, sellers took full control of the auction. Tuesday’s poor low was cleaned up in the process; however, after tagging the July 2024 high, another poor low was formed, which we carry forward. Value continues to follow price, as the short-term value (5D) shifted lower from 5966 to 5790.

The inability from buyers to break the critical resistance area between 5813 and 5823, which capped today’s upside, led to a downside continuation. Monday’s poor low was cleaned up in the process; however, another one was established today, which we carry forward. NFP is on deck tomorrow.

In terms of levels, the Smashlevel is at 5760, a level buyers struggled to reclaim during the afternoon session. Holding below this level would target a cleanup of today’s poor low at 5720. Acceptance below 5720 signals weakness, targeting the Weekly NVPOC at 5697, with a final target at 5675 under sustained selling pressure. Conversely, failure to hold below 5760 would target the high volume node at 5790, with a final target at the resistance area between 5813 and 5823 under sustained buying pressure.

Levels of Interest

Going into tomorrow's session, I will closely observe the behavior around 5760.

Break and hold above 5760 would target 5790 / 5813 / 5823
Holding below 5760 would target 5720 / 5697 / 5675

Additionally, pay attention to the following VIX levels: 26.58 and 23.16. These levels can provide confirmation of strength or weakness.

Break and hold above 5823 with VIX below 23.16 would confirm strength.
Break and hold below 5675 with VIX above 26.58 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.