Market Analysis and Trades for 7/17

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The weekly post for SPY 0.00%↑ and QQQ 0.00%↑ should be reviewed prior to this. Link to Market Analysis for The Week Ahead

Today was a fantastic example of the importance of being willing to trade both sides of the tape and react quickly. My bias into today was to the short side if NQ was holding below 23090-23097 and ES below 6292-6294. Notice that right before the open NQ was sitting below 23090 but ES was trading above 6292-6294. This effectively set up the scenario where 6300 triggered a failed reclaim of 6292-6294 and the first two hours of the day was a short. From last night’s plan and this morning’s premarket update:

This is also a great example of the importance of understanding short term inventory (how long or short participants broadly are) and watching NQ even if trading ES.

The 6260s didn’t hold a cash hours test, last week’s low was swept, and the weekly long setup played out. We can see how difficult it can be to watch the market sell 1% in relatively short order only to set up a juicy long.

From the weekly plan:

We note the failed reclaim of 6292-6294 triggered at open and the look below and fail of last week’s low which reclaimed and bid 6260-6262.5.

Notice the rejection at 23090 on NQ at the open and the hold (once again) of 22833-22841 which gave some added confluence to the ES LBAF.

Fantastic trading both sides of the tape today (naturally since I’m on vacation).

The weekly timeframe has now been brought to balance. Since this week failed higher first it has some implications for the action to follow.

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