ES Daily Plan | October 21, 2024
My preparations and expectations for the upcoming session.
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
As outlined in the Weekly Plan, the weekly and monthly timeframes are in an imbalance phase to the upside, while the daily remains in balance, currently forming a 5-day balance area between 5925 and 5850. Balance guidelines apply. The upper end of the balance holds unfinished business with the overnight ATH at 5927.25, while sellers need a break below 5850 to signal a potential shift in market tone. The immediate attention is on Friday’s inside day.
The general balance guideline suggests going with the break of the multi-day balance area and monitoring for continuation (acceptance) or lack thereof (rejection). If there is a lack of continuation following a breakout attempt, it can trigger moves in the opposite direction. The same guideline can be applied on the inside day.
In terms of levels, the Smashlevel is at 5914. Holding below this level would target the lower end of Friday’s inside day at 5887, with a final target of 5860 under sustained selling pressure. Failure to hold below 5914 would target the overnight ATH at 5927, with a final target of 5944 under sustained buying pressure.
Levels of Interest
Going into tomorrow's session, I will closely observe the behavior around 5914.
Break and hold above 5914 would target 5927 / 5944
Holding below 5914 would target 5887 / 5860
Additionally, pay attention to the following VIX levels: 19.10 and 16.96. These levels can provide confirmation of strength or weakness.
Break and hold above 5944 with VIX below 16.96 would confirm strength.
Break and hold below 5860 with VIX above 19.10 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
Make sure to review the Weekly Plan, which provides a broader perspective and highlights key levels of interest to observe in the upcoming week.
Thank you!!