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The yellow levels highlighted at the bottom left of the chart are the primary intraday levels I focus on. To avoid impulsive decisions at poor trade locations, I follow a simple but effective rule: exercise caution when initiating trades outside of these yellow levels.
This means I’m cautious about chasing longs above the Final Upside Target (FUT) and shorts below the Final Downside Target (FDT). It’s important to understand that not chasing does not imply initiating a trade in the opposite direction. Discipline over impulse.
Be sure to review the Weekly Plan for a broader perspective, key levels, and market expectations for the week ahead.
Contract Rollover
A quick reminder: I’ve switched to the ESZ26 (December) contract. As always, I do not back-adjust my charts. The roll gap at 7659.50 (ESU26 contract) has now been filled.
Contract rollovers can be confusing. While some traders back-adjust their charts, I prefer to leave historical levels unchanged, resulting in a visible roll gap. This is purely a matter of personal preference; neither approach is inherently superior, and both have their pros and cons.
For short-term traders, the impact is minimal, since we navigate the market day by day. During rollover periods, I typically scale back activity because order flow becomes noticeably less reliable.
Contextual Analysis & Plan
The overnight session was marked by early weakness, leading to a revisit of the prior ATH at 7648 (DT2). Buyers stepped in and defended this crucial HTF level twice, with strong confluence from the VIX testing its resistance at 17.92. The 7648 and 17.92 duo worked notably well today. Failure to defend 7659 (DT1) then triggered a sharp reversal heading into the RTH session, fully retracing the early weakness in the process.
During the RTH session, sellers took control of 7682 (Smashlevel) early on, once again triggering a notable reversal, this time to the downside. The auction returned to 7648, officially filling the roll gap at 7659.50 in the process, so that is now out of the way. Following the early liquidation break, price action was rather lackluster, with a distribution forming between the key 7659 and 7648 levels.
Session Recap
Today’s session formed a double distribution trend day with a b-shaped profile following the early liquidation break. The roll gap at 7659.50 was filled in the process.
The key area to monitor in the short term is today’s main distribution between 7662 and 7648 for clues as to what the market wants next.
Intraday strength would be indicated by a reclaim of 7685 (UT1), while weakness would be signaled by a break and hold below 7648 (DT1). FOMC is on deck tomorrow!
In terms of levels, the Smashlevel is at 7662, the upper end of today’s main distribution. Holding below 7662 would target a rotation toward the prior ATH at 7648 (DT1). Acceptance below 7648 would signal intraday weakness, targeting the unfilled bull gap at 7620 (DT2), with 7589 (FDT) serving as the final downside target under sustained selling pressure.
On the flip side, reclaiming 7662 shifts focus to today’s opening level at 7685 (UT1). Acceptance above 7685 would signal intraday strength, targeting 7711 (UT2), with 7735 (FUT) serving as the final upside target under sustained buying pressure.
Visual Representation
Levels of Interest
Going into tomorrow’s session, I’ll closely observe the behavior around 7662.
Break and hold above 7662 would target 7685 / 7711 / 7735
Holding below 7662 would target 7648 / 7620 / 7589
Additionally, pay attention to the following VIX levels: 18.08 and 16.32. These levels can provide confirmation of strength or weakness.
Break and hold above 7735 with VIX below 16.32 would confirm strength.
Break and hold below 7589 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.
Thanks Smash!
Thank you smash