ES Weekly Plan | September 2-6, 2024
My expectations for the upcoming week.
Visual Representation
Economic Calendar
Market Structure
🟨 DAILY: BALANCE | 10D | 5669-5573.50
🟩 WEEKLY: OTFU | ENDS: 5573.50
🟨 MONTHLY: BALANCE | 3M | 5721.25-5146
Contextual Analysis
Contextually, nothing has changed following last week’s price action, with the market remaining in a balanced state—now extending into a 10-day balance area. A similar situation occurred in late June, where an 11-day balance led to a significant breakout. While it’s impossible to predict the direction of the breakout from the current balance area, one thing is certain: the longer a consolidation phase lasts, the more significant the subsequent breakout tends to be, as demonstrated by the balance area from late June. Both the 5D VPOC and 20D VPOC are now situated within the balance area.
For this shortened week, the main focus remains identical to last week's: the current multi-day balance area between 5669 and 5573, where the market is coiling for a directional move as it awaits further market-generated information.
“Responsive activity is expected within this range, while a more decisive directional move would require acceptance outside its extremes. The general guideline suggests going with the break of the multi-day balance area and monitoring for continuation (acceptance) or lack thereof (rejection). If there is a lack of continuation following a breakout attempt, it can trigger moves in the opposite direction. A balance breakout would target new all-time highs, while a breakdown could see the HVN at 5530 acting as a magnet.”
The weekly Smashlevel (Pivot) is 5646, representing Friday’s spike base. Holding above 5646 would set the stage for a balance breakout, targeting the unfilled daily gap at 5690.25 and the current ATH (all-time high) at 5721.25. Acceptance above 5721.25 would then target the resistance area from 5745 to the Weekly Extreme High of 5770, where selling activity can be expected. Note how this resistance area coincides with the 100% range extension from the current daily balance area at 5764.
Break and hold below 5646, suggesting a lack of initiating buyers, would target the composite VAL (value area low) at 5612 and the high from three weeks ago at 5586. Acceptance below 5586 would open the door for a traverse of the upper distribution from three weeks ago, targeting the support area from 5555 to the Weekly Extreme Low of 5530, where buying activity can be expected. Note how this support area coincides with both the composite HVN (high volume node) and the MA50. For any potential change in tone to occur in the bigger picture, sellers would need to break and hold below the Weekly Extreme Low, ideally with a weekly close below it.
Levels of Interest
In the upcoming week, I will closely observe the behavior around 5646.
Holding above 5646 would target 5690 / 5721 / 5745 / 5770* / 5800 / 5830
Break and hold below 5646 would target 5612 / 5586 / 5555 / 5530* / 5487 / 5455
*Weekly Extremes. I exercise caution when initiating trades outside the Weekly Extremes to avoid making impulsive decisions at unfavorable locations. Essentially, the Weekly Extremes serve as a safeguard against emotionally-driven trades, a state that is less than ideal for making well-informed trading decisions.
As usual, a detailed daily plan will be published tomorrow. In the meantime, enjoy the rest of your weekend!
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Thanks Smash! HAGW!