ES Daily Plan | September 13, 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
The overnight session showed no interest in filling the structural deficiencies from Wednesday's session, as the market saw a grind higher, exploring prices above the spike area. The market's reaction to the PPI data and Jobless Claims was uneventful, with the Weekly Extreme High at 5580 capping the upside.
The RTH session opened within the spike area, initially hovering around the opening level and rejecting the FS VWAP. This led to a move lower, testing the Smashlevel at 5548, which marked yesterday's spike base. The market spent only a few minutes below 5548 before buyers regained control, signaling strength. As outlined in the previous plan, establishing value within or above the spike area was considered the strongest response, making it challenging to initiate shorts with the market holding above 5548.
The Weekly Extreme High at 5580 continued to cap the upside during its second test in the D-period (5579.25), resulting in a solid +20 handle reversal. However, the main theme of today’s session was that liquidation breaks were picked up by buyers, who have controlled the auction since breaking above the 5530 HVN, which shifted the overall tone. The third test of 5580 resulted in a break, leading to a squeeze that quickly reached the final intraday upside target of 5603, where the momentum eventually stalled. The 5603 level was not an ideal level to chase longs for several reasons: first, it was the final intraday upside target; second, the VIX remained above its support level of 16.62; and third, the Weekly Extreme High had been breached. Additionally, the market was forming a poor high, signaling crowded buyers. Fortunately, patient traders were gifted with another liquidation break in the K-period, which tested and found buyers at 5580.
The market saw an upside continuation today, following the acceptance of Wednesday’s closing strength, and effectively completed the fills of the poor structure from the triple distribution trend day on September 3rd. The session closed within the prior 10-day balance from late August, forming a poor high. Acceptance within this 10-day balance value targets a traverse toward 5646, while failure to do so would target today’s afternoon pullback low at 5580.
In terms of levels, the Smashlevel is at 5607, marking today’s non-excess high. Holding below this level would target the afternoon pullback low at 5580, with a final target at Wednesday’s spike base at 5548 under sustained selling pressure. Failure to hold below 5607 would target 5626, with a final target at 5646 under sustained buying pressure—completing a traverse of the 10-day balance value area.
Levels of Interest
Going into tomorrow's session, I will closely observe the behavior around 5607.
Break and hold above 5607 would target 5626 / 5646
Holding below 5607 would target 5580 / 5548
Additionally, pay attention to the following VIX levels: 18.08 and 16.06. These levels can provide confirmation of strength or weakness.
Break and hold above 5646 with VIX below 16.06 would confirm strength.
Break and hold below 5548 with VIX above 18.08 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.
I played a “Set and Forget”, walked away, and things worked out graciously. Entry long at Smash level 5548 with first target at 5580 and second at 5603. If I did stick around my desk, I would’ve probably cut the short. So, the trust I had in these levels prevailed. I’m incredibly grateful to you, Smash. Vamos! 🔥🔥👌
You are a sniper Smash! Thanks!