ES Daily Plan | September 18, 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
Just a quick reminder that I have transitioned to the ESZ24 (December) contract. Please note that I do not back-adjust my charts. I suggest marking 5629.75 on your chart, as roll gaps often tend to get filled. Regardless of whether you choose to back-adjust or not, the crucial point is that my intraday targets remain the same.
Sellers managed to defend the Smashlevel at 5701 during the Asian session; however, their failure to maintain this level during the European session led to an upside continuation, tagging the ATH (non-back-adjusted) at 5721.25 in the process.
The RTH session opened with a true gap up, an interesting development given the upcoming FOMC meeting tomorrow. A quick look above the ONH and fail triggered an inventory correction back toward the full session VWAP. Buyers ultimately emerged victorious after the 10-minute battle around the FS VWAP, regaining both the opening level and the ONH—two critical references for buyers in a gap-up scenario. The main challenge for buyers was the short distance between the ONH at 5727 and the final upside target at 5735, which was tagged in the C-period. A follower successfully shorted 5735 using the VIX as confluence, as it was not confirming strength by clearly holding above its support level of 16.16. Fading the final upside target was a reasonable idea, given that the FOMC meeting tomorrow will likely dictate the next directional move. As for the FOMC, it's generally wise to go flat 30 minutes before the event and conserve mental capital for Thursday and Friday. The gap was eventually filled, with the market closing within Monday’s range. The VIX printed a high of 18.08, with 18.12 outlined as resistance in the previous plan.
Today’s session formed a double distribution, marked by a set of single prints in the F-period after printing a new all-time high (5737). The failure to sustain upside momentum following the gap higher led to a close within the lower distribution. The main event tomorrow is, of course, the FOMC meeting.
In terms of levels, the Smashlevel is at 5701. Holding below this level would target the support area between 5679 and 5669, with a final target at 5642 under sustained selling pressure (outlier: 5629). Failure to hold below 5701 would target the prior ATH (non-back-adjusted) at 5721.25, with a final target at the current ATH at 5737 under sustained buying pressure (outlier: 5755).
Levels of Interest
Going into tomorrow's session, I will closely observe the behavior around 5701.
Break and hold above 5701 would target 5721 / 5737 / (5755)
Holding below 5701 would target 5685 / 5665 / 5642 / (5629)
Additionally, pay attention to the following VIX levels: 18.64 and 16.58. These levels can provide confirmation of strength or weakness.
Break and hold above 5737 with VIX below 16.58 would confirm strength.
Break and hold below 5642 with VIX above 18.64 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.
Thanks Smash! Good time to do nothing!
Many Thanks for your daily plans, analyses and thoughts. I love them a lot and they help me to structure my daily trading plan. Your thinking and didactics fit my thinking perfectly. So happy that I found you. Keep up this great work!