SPX SPY ES for 3/04/24

Monday Recap

The plan for today was to buy dips if we traded lower first, and the only short setup provided was upon trading 5157.5. In the discord today we talked about buying dips and selling pops around today’s developing value and keeping some for an eventual break higher. We finally got this move higher in the afternoon where we ran into out 5157.5 spot and it was time to exit longs except for any very small runners. As warned, buyers were unable to press and therefore were liquidated into the close by sellers, with selling accelerating on the loss of 51.75.

I was extremely specific with the description of this short setup over the weekend and there is a fair amount to be learned from the thought process, so it is shared here.

You can see how while we had only traded lower earlier in the day, the dip buying was persistent. However, once the index had failed to trade higher and resolved back within Friday’s range the bid had completely evaporated. This is a good example of why there is often much more to markets than simple “support and resistance.” It may be easier for me to simply give a support and resistance, but the context around how we arrive at the situation will always impact the likeliness that it will hold.

The question now is if that failure to move higher translates into continuing weakness on higher timeframes or if that was simply a brief sell-off and we resume buying dips tomorrow.

IMPORTANT THIS WEEK

I will continue to use the current (March) ES contract for levels through Friday. Trading View will change ES1 (front contract) to the June contract on Thursday at 1800 EST open and thus will affect Friday trading. One can use ESH2024 on Friday to have these levels apply.

Be sure to see the weekly plan for a bit of context and expanded commentary HERE.

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.

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.