[COPY] Quick SPX ES SPY Update 10/16
Reminder I'll post updated to trade setups in the AM via chat.
Today was a pretty wild day. We were bullish over ES 4365-69 and in particular after the Euros failed to fill the ES gap which is quite rare outside of a major new event that occurs while ES isn’t trading. Into the open we had 4375.25 as a key inflection point and it was never tested. There was zero interest below the open on today’s inside gap up and sellers were fully trapped. We had 80-82 to long off the initial stall at 4390 and the rest was history. We are currently trading in as 5-day balance and consolidating near the highs. As of now I see 2 potential 20+ point trades. Will we break out tomorrow? If so, what is the target?
TLDR version major levels High to low:
4446, 4435-40, 4419-24 (really just 19), 4411.5, 4398.25, 4392, 4375.25
The ideal situation for buyers would be to maintain todays VAL which I’m calling 4398.25 (or look below and fail discussed below. 4395.75 is roughly last week’s VPOC and is worth noting tomorrow. While I don’t consider it to be support per se, continuing weakness below would be meaningful as we move forward in the week. 4392 (call it 90-92 if you like) is a bit of a must hold (or look below and reclaim at minimum) for buyers to have a chance of a breakout tomorrow. The Afternoon Pullback Low (APBL) of 4385.5 is worth marking as it sits right near the Q3 VAL but is another level I don’t consider support. Simply worth observing continuing weakness (or lack thereof) below for the rest of the week. Continued weakness below 4392 should really find its way to 4375.25 representing a complete unravel of today’s P shaped profile (see my YouTube video on P shaped profile breakdowns given a lack of initiative buyers.
If we trade below 4398.25 overnight and then reclaim it late in the session before cash open or just after cash open, then a value traverse to 4410-11 is reasonable to expect (requires real acceptance back above). This is an absolutely golden setup in my opinion as it would get a long in at a great entry with then the possibility of holding runners for an upside breakout of the balance with trapped sellers providing the energy needed.
On the short side I will consider shorts if we trade below 4398.25, maybe weaken 4392 with a test and then fail a back test of 4398.25 from below. I’ll be wary of 4392 possibly holding again but if it is lost then the possibility of seeing 4375.25 is real.
As always, all of these potential setups will depend on the overnight action so I will post in the morning chat using the same chat I had from today so that hopefully everyone has had a chance to turn on notifications for replies to that thread (I am the only one who can post in there).
See you in the morning!
Hi