[COPY] SPX SPY ES for 3/14/24
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Today was quite a disgusting mess of chop for most of the day which I will describe with this meme:
After repeated fails in the 43-46 range this then turned into a beautiful box breakdown short for those who hadn’t yet died of boredom:
From there I finally took the trade I had been waiting for since the morning (Discord is now EST-3):
The primary targets for this trade were 32 and 36 which printed very quickly. I’m told that calls went from $0.7 to $15 in minutes. I personally just traded ES
Tomorrow, we have a huge amount of data so another inside day is pretty unlikely. The test of 5221 today may have weakened it and the multiple tests of 46 the last 2 days should have weakened it. Thus we could see a decent move tomorrow either direction. We’ll discuss how we’ll play either direction in tonight’s post.
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Levels: Reminder I use a lot of levels, but these aren’t intended to be traded “level to level,” Depending on what the “active sequence” is for a given trade will determine which levels are most relevant at a given time and that is reflected in the trade setups. Trims of existing positions can be considered depending on the action at each level.
5305
5294
5276 (using 76 and 69 for tomorrow instead of weekly 73)
5269
5257.25 reference Friday’s high of day.
5242.75-5246 (ESM Friday VAH into the bottom of Friday’s upper distribution-extended to today’s high of day. Index is clearly struggling with this spot
5240.5 reference today’s VAH (leaves a good setup for look above and fail with the difficulty of 42.75-5246 above). This would more likely be something that plays out before data if it is going to.
5228.75 Today (3/13) IB low and “price spike” Roughly 3/8 RTH open. Buyers will want to defend this to reject today’s late day move down.
5223 Reference Today (3/13) Excess below. I don’t consider this particularly supportive per se and sellers will want to negate this. I feel that stronger buyers would defend by 28.75
5217.5 reference today’s low
5213.25
5201.75
5192
5169.5 (5168-72 okay to keep
See weekly levels for lower
COMMENTARY:
In last night’s post I mentioned one potential bearish scenario was continued fails of yesterday’s high. We saw that today and it resulted in a pretty nasty liquidation. However, the liquidation was bought (by many of us) and liquidations invite stronger buyers who may then have the strength to carry a breakout. This is another of the countless examples we’ve seen lately. That said I’m not yet convinced that this was strong buyers, as intraday traders (like us) know this day trade. The move could possibly have just cleared out some residual demand and trapped sellers and now have room to move lower on poor data. I have a feeling that, like Tuesday, data will change everything. On an inside day the plan is simple, go with a break that sees continuation and fade the look above/below and fail. The easier trade would seem to be to the long side if we break out to the upside given the broader bullish context. Trading lower we run into trapped sellers who are natural buyers. That said if we find traction below today’s low then I would expct 5201.75 to be tested. It is possible that 5208 holds things together for a trap but here’s the problem with that. Here’s the 2 days volume profile:
All hours:
RTH Only:
If you haven’t watched my video on P shaped profile breakdown trades I would encourage it:
TRADE SETUPS:
General rule, if a long setup is playing out then in my head, I am slightly downgrading the short setups and being more patient for confirmation. The same is true in reverse.
It’s kind of lame but we have to keep it general tomorrow again. There’s a pretty high probability that today’s high or low is taken out during data, and a pretty high probability that we open above today’s high or below today’s low.
Thus, I’m looking for shorts for the P breakdown or looking for longs if we break above today/yesterday highs.
Look above/below always applies. A look above and fail increases the chances of seeing the bottom of the P at Tuesday’s low or at least 5192. In order to trigger the P breakdown short price will need to get trapped under 5226-29 or so. I can’t stress enough we have to be careful here because of all the trapped sellers at each level lower but if the response to data is truly bad and persists then we can see a full breakdown of the P. I would be extra cautious of traps that may occur during premarket. If we make it cash open and we are trapped below 26-29 then these traps are perhaps less likely.
A look below and fail of today’s low or even 5228.75 increases the chances that we take out today’s highs and likely take out Friday’s highs.