SPX SPY ES for 2/28/24
Abbreviated post tonight and I may be off tomorrow as I got covid from a coworker.
The plan was to stay short biased until we got a proper back test of the 5066.5 breakout (minimum 5072.5) and I personally swung short from 5121.75. Today was another day of grinding chop downward until we finally got that back test and saw the expected reaction. The overnight action saw a low of 5073 and a few of us that were up that late took the long as the setup had been identified earlier in the evening. You can see the relative equal lows which were swept at 12:40 am just above 72.5 which resolved nearly 18 handles higher into premarket right into our short setup:
The big seller was indeed lurking in the 5087.75-5089.5 range as expected:
He hit it from 5090 and then a second time just before the open from 89 right as things were looking pretty bullish. This was very easy to miss if you weren’t fully prepared for this spot and the action went from very bullish from the Europe session to fully bearish during cash. This is the importance of assessing each session open for any changes in participant strength.
I personally day traded today short on top of my swing short, covered 75% of my swing short position and 100% of my day trade position into the 5066.5 test, hedged the rest of the swing short with long ES, and flipped net long once 5072.5 was reclaimed for a day trade. I clipped my longs at 5089 as mentioned on X and in Discord with plans to stop on the remaining swing short if 5093 is bid. The afterhours high was 5093.0 (bid 5092.75) and thus I remain short. I will frankly be a bit surprised if this does not get stopped out overnight. I was considering flipping swing long off a 5066.5 hold but being sick just decided to plan to get flat after the big win.
The hold of 5066.5 (5067 low of day) was fully expected by pretty much everyone alive and it almost seems too easy. Our big seller was always going to cover a large portion (if not all) of his position there, so he has an opportunity to reload higher if he likes.
Will that be the swing low that takes us to new highs, or was it indeed a bit too easy and we revisit and possibly take out those lows? Tomorrow will bring opportunities on both sides and we will have to choose our bias. As always, as long as we enter trades in optimal locations, we can be wrong and still profit.
To learn more about how I trade, see the post “What is Trading Doggy Style” Here
-For those that trade SPY/SPX, there is an ES to SPY/SPX converter in Tradingview. See announcements in the Discord.
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