ES Daily Plan | September 11, 2023

Starting tomorrow, I will transition to the ESZ23 (December) contract. In terms of immediate focus, I'm keeping an eye on Friday's afternoon rally high at 4518 (ESZ23), where sellers were active.

ES Daily Plan | September 11, 2023

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Contextual Analysis

As mentioned in the Weekly Plan published yesterday, starting tomorrow, I will transition to the ESZ23 (December) contract. Please note that I do not back-adjust my charts. On the chart, I have marked the settlements for both ESU23 (September) (4461.75) and ESZ23 (December) (4511.25) from Friday’s session (+49.50 difference). I suggest marking 4461.75 on your chart, as roll gaps often tend to get filled. The levels for tomorrow’s session are based on Friday’s session from the ESZ23 (December) contract. Contract rollovers often give rise to confusion. While some traders choose to back-adjust their charts, I personally prefer to keep my past levels unchanged without adopting this approach and simply deal with the roll gap. Nevertheless, whether you choose to back-adjust or not, the crucial point is that tomorrow's intraday targets (yellow levels at the bottom left) remain the same.

The market remains in a state of balance, awaiting additional market-generated information. Potential catalysts are the CPI data set to be released on Wednesday, followed by PPI on Thursday. The VPOCs for the 5D (4465), 20D (4465) and 90D (4415) periods are all situated within the current 4-week balance area, confirming the balance. In order to see a stronger directional move, the market must establish acceptance beyond this multi-week balance area. In terms of immediate focus, I'm keeping an eye on Friday's afternoon rally high at 4518 (ESZ23), where sellers were active.

For tomorrow, the Smashlevel (Pivot) is 4518, representing Friday’s afternoon rally high (ESZ23). Break and hold above 4518 would target a cleanup of the initial balance high at 4525, as well as the final upside target of 4541. Holding below 4518 would target the pivotal weekly level of interest at 4500. Break and hold below 4500 would target 4489, as well as the final downside target of 4473.

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Going into tomorrow's session, I will observe 4518.

• Break and hold above 4518 would target 4525 / 4541

• Holding below 4518 would target 4500 / 4489 / 4473

Additionally, pay attention to the following VIX levels: 14.48 and 13.20. These levels can provide confirmation of strength or weakness.

• Break and hold above 4541 with VIX below 13.20 would confirm strength.

• Break and hold below 4473 with VIX above 14.48 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.

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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.

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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.