SPX ES SPY Trades for 1/31/24
-For those that trade SPY/SPX, there is an ES to SPY/SPX converter in Tradingview. See announcements in the Discord.
Discord policy may change to a wait period in the near future. Instructions for access (free for paid substack subscribers) are HERE. Reminder that it can take a couple days to get the invite link and ultimately assigned member status once in the “landing” area of Discord.
-To learn more about what this Substack offers, please click HERE. I would like to avoid people signing up before they know what they are getting.
The overnight and cash session today was choppy but rather uneventful until some afterhours fireworks with MSFT, GOOGL, AMD reporting. Following yesterday’s late day breakout price consolidated overnight and during RTH between our first long setup and our first short setup.
The early overnight session looked above and failed yesterday’s high and resolved down to 4942.25-4945.25 (40.75 the overnight low before open). Long setup 1 then triggered for a test of yesterday’s highs and actually worked 3 times today. Following one last exhaustive push higher, finally through yesterday’s high, the RTH version of short setup 1 played out and triggered short setup 2 after hours which just hit it’s target.
Short setup 2, I had specified that I would favor this trade working out if we had taken out yesterday’s high first. I personally had no interest in this breakdown short if we had traded lower directly.
I had personally taken two longs today only until we swept yesterday’s highs. I had prepared for that eventuality more than 3 hours prior and took the short on what appeared to me to be one last exhaustive push higher followed by a swift rejection. Discord times are EST-2.
We have the Treasury Refunding Announcement and FOMC tomorrow. The mix of long-term bonds vs short term bills that are announced will play a huge role on what yields do, which will in turn impact NQ and RTY the most, and ES as a result.
Probably the highlight of the day for us was XLE. The swing was initiated on 1/22 $80.10 on commons and $1.06 on the March $85C. XLE closed at $84.98 today with the calls trading at $2.74 at high of day up nearly 160%.
We additionally took some shorter dated calls today. I personally stopped out and re-entered but we knew what we were looking for and it worked out beautifully. I’m sharing this (for those that missed it) as an example of how, with managing very tight risk, I can take a paper cut and still re-enter a valid trade.
The red line is where I stopped out and the 5-minute morning star reversal off yesterday’s low is where I re-entered (picture 1). Picture 2 is the crude chart. You can see the bid come in in the 76.6s on crude at the same time that XLE formed that morning star.