ES Daily Plan | September 10, 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
In the previous plan, I outlined and illustrated several potential scenarios, with the least favorable being an immediate downside continuation, which was less attractive given Friday's close, 116 handles below the 5D VPOC (short-term value). The main focus was on Friday’s afternoon balance. Overnight, sellers struggled to gain traction below the 5412 level, leading to a move toward the opposite side of the balance at 5435—the next key decision point. Failure to regain 5435 would be bearish, while a break above had the potential to trigger a short-covering bounce, as discussed. was regained and the market quickly reached Friday’s initial balance low, where the upside momentum temporarily stalled.
The short-covering bounce continued in the RTH session, reaching the resistance area between 5472 and 5482. If you had not initiated a long trade by then, this resistance area was not an optimal location to start, as it was more suitable for booking profits from longs. The resistance area provided a notable reaction to the downside. Traders who were unprepared for the session and did not consider the context likely got caught shorting the overnight open with Friday’s session in mind. They subsequently found themselves on the wrong side by entering longs at resistance, which was affected by the prevailing upside momentum. By simply preparing for the session, you put yourself ahead of most traders. The pullback from resistance filled the single prints from the overnight session, where buyers emerged. Once back within the initial balance, another squeeze unfolded, which ultimately tagged and exceeded the resistance area. However, buyers failed to sustain this push, leading to a poor high and triggering another liquidation break. The VIX remained below its support level throughout most of the RTH session, making a significant market collapse less likely.
The lack of an immediate downside continuation overnight triggered short-covering, leading to the formation of an inside day that partially filled Friday’s poor structure in the process. The general guideline suggests going with the break of the inside day and monitoring for continuation or lack thereof. An upside break would target the HVN at 5530, while a downside break will target a revisit of Friday’s lows at 5412.
In terms of levels, the Smashlevel is at 5462, marking today’s opening level. Holding above this level would target the resistance area between 5490 and 5500, with a final target at the 5530 HVN in the event of a sustained inside day breakout. Failure to hold above 5462 would target Friday’s afternoon balance high at 5435, with a final target at 5412 under sustained selling pressure.
Levels of Interest
Going into tomorrow's session, I will closely observe the behavior around 5462.
Holding above 5462 would target 5490 / 5500 / 5530
Break and hold below 5462 would target 5435 / 5412
Additionally, pay attention to the following VIX levels: 20.86 and 18.04. These levels can provide confirmation of strength or weakness.
Break and hold above 5530 with VIX below 18.04 would confirm strength.
Break and hold below 5412 with VIX above 20.86 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 for your great work:)
Blessings, brother! 👌🔥