Trade Plan for 11/18
BTFD or STFR?
The weekly post for SPY 0.00%↑ and QQQ 0.00%↑ should be reviewed prior to this. Link to The Week Ahead
In case you missed the announcement from last week the pricing change on the course will likely go into effect this Tuesday and the announcement regarding Discord perhaps shortly thereafter. Announcement
As mentioned in the weekly plan and illustrated in the non-paywalled Markets Overview post, we have come into a rather binary spot across indices. We saw some minor relief off the lows on Friday and will need to see if there is follow through tonight and tomorrow. It is certainly reasonable to consider the possibility of a swing low here or near here. The daily plans and the Discord commentary will be key for determining if and when we are ready to flip directionally long this market.
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Levels - Note not all weekly levels will be used each day but they could all present as part of an “active sequence” within a given day(s). Focus on the bold levels in general and certainly on high time frames
ES Levels to add to the weekly levels for Monday:
5911.75 Friday’s VAH
5885 Friday’s VAL
5845.5
NQ Levels to add to the weekly levels for Monday:
20660
COMMENTARY:
Monday could be a bit tricky so I would be mentally prepared for that. We have conflict across timeframes, and we have a fresh week of participants coming in. The weekly commentary covered most of this. This means you get a slightly more complicated plan/setups. I will have a tentative plan to short pops if we trade higher first.
We closed RTH at 5897 and 5900 at 5pm right into the 5900.75-5904.75 spot. SPX closed at 5870.63 with 5872-5875 representing its box back test. It is the short timeframes that will chop us up as this back test fully resolves.
SHORTS: I am more likely (but not an absolute requirement) to take these if we trade higher first and one of the below long setups has not played out (particularly during RTH)
If we fail 5900.75-5904.75 or look above and fail, then I would get short and expect resolution to at least 5890 (a natural target particularly if overnight) then 5885. I will be monitoring for dip buy activity in the 5885-5890 range (see below) so I will plan to cover some and monitor for continuation to and through Friday’s 5876.75 low.
If we fail or look above and fail 5915.5 then I would get short. I would be prepared to cover some in the 5900.75-5904.75 range and monitor for continuation. Back down through 5900.75 and it turns into the above. This trade is therefore a bit trickier as 5900.75-5904.75 could hold, but it offers a greater reward for that sweat.
If we trade up to 5925-5927.25 then we would have a decent amount of session information available to us. I am less likely to short this directly if it is a clear trend session. That said, it is still a short if it fails. It simply may require more patience for entry. If we trade this high overnight, then I’ll update in the Discord what I would need to see to get short.
Any kind of look above and fail of Friday’s high can still be a short as we test the island gap. Again, whether or not I’m willing to take this will depend on how the action has played out so I will update in the Discord if we approach it.
LONGS:
A look below and fail of 5885 targets 5893 and 5900.75-5904.75. Monitor for continuation from there. Because I lean toward this sell being a liquidation and not high time frame longs exiting, this type of failure from sellers could be what bulls need to start pressing. I am therefore open to a careful attempt at a swing long off this setup. As always, I would prefer to have short runners in place as I try to take a short time frame counter trend long.
A look below and fail of Friday’s low would need to reclaim and base above 5885 which then turns into the above setup. I am open to taking it without waiting for a 5885 reclaim as we can’t chase rips right now. I would simply be prepared to take profit quickly and get a stop to breakeven (at least for the entirety of the trade) if 5885 rejects. I would tend to be more cautious of the 5890-5893 range as well in this setup. Just like the above, I am open to a careful attempt at a swing long off this setup. The weekly plan mentioned a LBAF of Friday’s low that, if we got a strong close, would be a good setup for a stronger move higher.
If we trade higher longs get very tricky for Monday. I certainly won’t chase a rip, but if we get a bullish session then I’m open to buying dips above 5900.75-5904.75. I would remain wary of all of the above short setups. One can use them to guide profit takes, to hedge an edge, or to get flat. As for a couple of the short setups, if we find ourselves above 5900.75-5904.75 in the morning, the AM update will be key.