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August2023

8/31 Daily Recap, Outlook, and Trading PlanRecap The trading week so far has been marked by a powerful rally, with four massive green days in a row. We've retraced 60% of the selloff that took bears the entire month of August in just four days. The combination of failed breakdowns and runners has proven incredibly effective, leading to the largest gain of 2023 for me in terms of points. Market Outlook: Neutral to Bullish The Markets Overnight 🌏 Asia: Mixed 🌍 Europe: Up a bit 🌎 US Index Futures: Up a bit 🛢 Crude Oil: Up 💵 Dollar: Up 🧐 Yields: Down 🔮 Crypto: Down slightly World News European inflation remains flat at 5.3% US PCE inflation holds steady Key Structures The yellow declining channel from the August high is a bull flag with 4507 resistance and support around 4400 now. The 4410 level has been a magnet all month and is also the yellow trendline connecting the Dec 2022, Feb 2023 highs, and June 2023 low. I call this the bull/bear line and bulls control above, bears control below. Support Levels Supports are: 4515 (major), 4508 (major), 4499, 4490-93, 4482 (major), 4473, 4466 (major), 4454, 4448 (major), 4440, 4430, 4423 (major), 4410 (major), 4397 (major), 4389, 4377 (major), 4364, 4357 (major), 4348, 4339 (major), 4329, 4321 (major). Resistance Levels Resistances are: 4515 (major), 4527, 4533, 4537 (major), 4546, 4560-65 (major), 4575, 4585, 4592 (major), 4597, 4607 (major), 4619, 4630, 4640-45 (major). Trading Plan As long as the 4508 and 4515 levels hold, the bull case today looks like base building above 4515, then run up the levels to 4537, perhaps as high as 4545. Potential dip spot there, then continue to 4560-65. The bear case today begins on the fail of 4508. This is a possible short, but I don’t chase. If you chase, you get caught in a failed breakdown. Wrap Up We are now in the post-rally phase. There is obviously high risk of rapid, violent rug pulls now after 4 green days into a major resistance. As long as 4515-08 holds, we can push to 4537-4545, dip there (if bears are lucky, maybe even a top). Above there after, we continue to 4560-65. 4508 fails, we start the sell. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!Long
by spytradingpro
8/30 Daily Recap, Outlook, and Trading PlanRecap As anticipated, the ES put in a core setup and a major bottoming pattern last Friday at 11am. Since then, it's been a steady climb to the upside. I got long at 4385 and have been holding since, turning it into an incredible 120 point long. As I predicted on Monday, the bull case played out exactly as expected, with the ES basing under 4448 all night, then taking the run up to 4474-76. ES did not stop there, instead running for 4515 which has been my macro target all week. Market Outlook: Bullish The Markets Overnight 🌏 Asia: Up a bit 🌍 Europe: Up slightly 🌎 US Index Futures: Near unchanged 🛢 Crude Oil: Up 💵 Dollar: Down 🧐 Yields: Down 🔮 Crypto: Down World News U.S. Commerce Secretary Gina Raimondo critical of Chinese business environment. Key Structures The key structures I'm watching now include the purple declining channel from the August high, the 4458 & 4548 zone, the 4408 level, and the 4376 support. These structures provide context to the daily price action and are not meant to be predictive. Support Levels Supports are: 4498, 4487-93 (major), 4475, 4466, 4458 (major) 4454, 4448 (major), 4440, 4430, 4424 (major), 4417, 4409 (major), 4403 (major), 4392-89, 4374-76 (major), 4358, 4348 (major), 4338, 4330, 4318-21 (major). Resistance Levels Resistances are: 4513-15 (major), 4523, 4527, 4537 (major), 4544, 4557 (major), 4570-72 (major), 4585, 4592, 4597 (major), 4607 (major), 4615-18, 4628, 4637 (major), 4651. Trading Plan After such a major move, it's crucial to trade carefully and selectively. The first major support down is 4487-93. If this fails, we could see some selling and any longs would be considered knife catches. The first major resistance is 4513-15. If we overthrow to something like 4523 then lose 4515, it may represent a more attractive setup for those interested in these. Wrap Up The bull case has played out as expected and now it's time to step back and wait for the market to reveal its next move. After a big move, it's crucial to trade light and patiently wait for price discovery. If we clear 4513-15 with force, we simply continue up the levels to 4537 then 4570 direct. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!Long
by spytradingpro
8/29 Daily Recap, Outlook, and Trading PlanRecap August is nearing its end and incredibly for the entire month, ES has only put in two consecutive green days on one occasion. The latest attempt began on Friday, and as readers recall, I got long at 4385 based on my core, highest win rate trading pattern - the failed breakdown. Market Outlook: Neutral to Bullish The Markets Overnight 🌏 Asia: Up 🌍 Europe: Up 🌎 US Index Futures: Down slightly 🛢 Crude Oil: Up 💵 Dollar: Up 🧐 Yields: Up a bit 🔮 Crypto: Down a bit World News Chinese markets were strongly higher overnight on reports of more stimulus as state banks lower mortgage rates. European Union announces new expansion plans. Key Structures Some core big picture structures and levels I am watching now (from highest to lowest). These are big picture structures, and provide context to the daily price action. They are not meant to be “predictive” and I will be trading the intraday levels in the below plan level to level, one level at a time, one move at a time, then resetting bias. These are not comprehensive. Support Levels Supports are: 4441 (major), 4430, 4424 (major), 4409-13 (major), 4398, 4387-90, 4376 (major), 4360, 4347-52 (major), 4339, 4327, 4318-20 (major), 4312, 4300 (major), 4287 (major), 4278, 4266 (major), 4241, 4225-30 (major) Resistance Levels Resistances are: 4448, 4454 (major), 4466, 4474-76 (major), 4487-93 (major), 4500, 4513-16 (major), 4523, 4528, 4538 (major), 4545, 4556 (major), 4565-68 (major). Trading Plan Bull case: Unchanged. I posted something very simple all last week. Bulls control above 4408, and bears control below. Since we reclaim 4408 on Friday (plus the failed breakdown), bulls control. Generally, the bull case from here looks something like base more under 4448, then take the run up the lvls to 4454, 4466, then 4474-76. Dip there, then onto 4513. Bear case: Unchanged. Loss of 4408 is the first big warning for bulls. The sell trigger remains the same as Friday, which is the failure of 4376. I’d short this, but as always - I don’t chase. I’d need to see a bounce there to drain demand, then I’d look short 4373 for the next leg down. Level to level profit takes as always, but seeing 4320 would not shock me. Wrap Up In summary, my general lean is that we can base more above 4424 then run to 4466, 4474-76. If 4424 fails, we retest 4408, and the loss of that is a big warning for bulls. 4376 fail starts the next trend leg down. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!Long
by spytradingpro
8/27 Daily Recap, Outlook, and Trading PlanRecap Friday was a typical Jackson Hole day, characterized by unpredictability and traps. As predicted, the day saw extensive trapping where the price would make an initial move, trap traders, reverse, and then repeat. Despite the volatility, bulls won the day, maintaining control as long as the 4408 level held. Market Outlook: Neutral to Bullish Key Structures There are several key structures to watch. The large rising uptrend channel in white, which failed on Tuesday, August 15th, causing a 120 point flush, needs to reclaim to set a definitive bottom. The yellow channel, a failed bull flag with 4523 resistance and support around 4408-10, needs to be re-entered by the bulls. Lastly, the head and shoulders pattern built since mid-June tried to breakdown the "neckline" at 4375 Thursday and failed, indicating a bullish failed breakdown. Support Levels Supports are at 4408-10 (major), 4402, 4382-85 (major), 4375 (major), 4363, 4357 (major), 4348, 4339 (major), 4328, 4319-23 (major), 4311, 4298-4301 (major), 4282-86 (major), 4272, 4266, 4247 (major), 4235 (major). Resistance Levels Resistances are at 4423 (major), 4429,4437-40 (major), 4448, 4453 (major), 4467, 4474 (major), 4482, 4487-92 (major), 4499, 4512 (major), 4522 (major), 4527, 4540-45 (major), 4554, 4560, 4566-68, 4576-80 (major), 4592, 4598, 4607-09 (major). Trading Plan For Monday, the bull case remains the same. As long as the level of 4408 is maintained, the rally is alive. The bear case requires the level of 4375 to fail. In both cases, it is essential to see the level fully accepted before attempting shorts or longs. If 4408 fails, we play the levels. If 4375 fails, we free fall. Wrap Up In summary, we are still in deep chop around the 4408 magnet. My general lean as of now is that as long as 4408-10 keeps holding, we can base build then continue up the levels. If 4408 fails, we play the levels. If 4375 fails, we free fall. As always, trade with caution and don't chase. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!Long
by spytradingpro
8/24 Daily Recap, Outlook, and Trading PlanRecap Yesterday saw a clean uptrend move in ES, marking a major low after three days of higher daily lows. The relief bounce to 4418 and high 4420s was anticipated and played out as expected. The day ended with ES reclaiming 4400 and squeezing to the 4426-29 target. The market now sits 100 points off last Friday’s low, with key catalysts such as NVDA earnings and Jackson Hole on Friday ahead. Market Outlook: Bullish Premarket 🌏 Asia: Up 🌍 Europe: Up slightly 🌎 US Index Futures: Mostly up but areas of weakness 🛢 Crude Oil: Down 💵 Dollar: Up 🧐 Yields: Up 🔮 Crypto: Down a bit World Headlines NVIDIA reignites AI rally with their blowout earnings report. Key Structures The large rising uptrend channel connecting the March and May lows failed last Tuesday, causing a 120 point flush. Resistance is currently at 4500, with closer bottom indicator at 4470-75. The declining channel from the August high has resistance today at 4445-47 and support at 4310. The yellow declining channel from the August high was reclaimed yesterday, with support at 4429-23 today. Support Levels Key support levels include 4442, 4429 (major), 4423, 4412, 4403-06 (major), 4389, 4376-74 (major), 4368, 4345-50 (major), 4339, 4329, 4318 (major), 4308, 4300-02 (major), 4286 (major), 4273, 4265, 4247, 4241 (major), 4230-35 (major). Resistance Levels Resistance levels to watch are 4448 (major), 4454, 4470-75 (major), 4487-90, 4500 (major), 4512 (major), 4517, 4533 (major), 4540 (major), 4545, 4555, 4565 (major), 4580, 4593 (major), 4600, 4607, 4618-22 (major). Trading Plan The bull case today requires holding 4429-26 on any dips, ideally building a base in the range between 4429-4450, then taking a run to 4470-75 next, followed by 4500. The bear case begins on the fail of 4403, with a short at 4399 for a move down the levels. A fail of 4429-23 is another potential short entry point. Wrap Up After a big trend move and with NVDA big positive earnings, the general lean is that ES can defend 4429 and try the run to 4470-75. As always, following the price and not predicting is key. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!Long
by spytradingpro
8/23 Daily Recap, Outlook, and Trading PlanRecap ES broke its three-day red streak last Friday by putting in a daily bullish reversal candle. This triggered a relief rally that started this week, squeezing 60+ points. Despite the volatility, ES has remained in the same position as it was on Friday/Monday in the 4390-4400 support cluster. The question now is whether ES is building a base for a bottom or setting up for its next leg down. Market Outlook: Neutral Premarket 🌏 Asia: Mixed 🌍 Europe: Mixed 🌎 US Index Futures: Up slightly 🛢 Crude Oil: Down 💵 Dollar: Up 🧐 Yields: Down 🔮 Crypto: Up slightly World Headlines Slowing European PMI data Key Structures The large rising uptrend channel in white connecting the March and May lows failed last Tuesday, causing a 120 point flush. To set a definitive “bottom” this has to reclaim and currently, resistance is way up at 4493. The August high has resistance at 4448-54 and support at 4315. The yellow declining channel from the August high is a failed bull flag with resistance at 4426-29. Support Levels Supports are: 4390-92 (major), 4382, 4376, 4370-72 (major), 4347 (major), 4333, 4317 (major), 4311, 4303-05 (major), 4287 (major), 4272, 4265, 4254, 4247 (major), 4230-35 (major), 4220 Resistance Levels Resistances are: 4400-4405 (major), 4413, 4418, 4426-29 (major), 4448, 4452 (major), 4468 (major), 4474, 4480, 4493 (major), 4512 (major), 4517, 4530, 4538-41 (major), 4549, 4560-62, 4578-80 (major). Trading Plan The bull case depends on 4390 holding and as of writing, we are hovering just above. As long as that 4390-4400 battleground holds, the relief bounce that began last Friday is still alive. The bear case begins on the fail of 4390. I’d look to short this. As always, I don’t chase. I’d ideally like to see some sort of final bounce attempt here, then 4388 would trigger shorts. Wrap Up ES is at a major inflection point here and is about to make a decision. I am prepared to react accordingly whatever path it chooses. My general lean though is that since 4390 has not failed yet, that ES can try to continue the relief bounce one more time (to 4418, high 4420s). 4390 fails though, we will head to low 4370s which is the last stop before new lows. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro
8/22 Daily Recap, Outlook, and Trading PlanRecap In my last newsletter, I spoke about the bullish hammer candle reversal day we saw in ES after three straight red days. This was only the third green day in the entire month of August. As a result, I was holding long over the weekend with multiple setups to add to this. My general lean was that we could bounce more, to 4404, then perhaps 4420s before trying lower, and this is precisely what played out yesterday. Market Outlook: Neutral Premarket 🌏 Asia: Up 🌍 Europe: Up 🌎 US Index Futures: Up 🛢 Crude Oil: Down a bit 💵 Dollar: Up slightly 🧐 Yields: Up slightly 🔮 Crypto: Down slightly World Headlines Reducing reliance on the US dollar in focus at the BRICS summit beginning today. Key Structures ES has done something yesterday for the first time in August: It put in two consecutive green days - a true rarity. The questions is, can bulls keep it going? The large rising uptrend channel in white connecting the March and May lows failed on Tuesday, causing 3 days of selling. To set a definitive “bottom” this has to reclaim and currently, resistance is way up at 4487-90. Support Levels Supports are: 4411, 4405 (major), 4392-94 (major), 4382, 4369-72 (major), 4345-48 (major), 4340, 4328, 4315-19 (major), 4304 (major), 4287 (major), 4275, 4267 (major), 4247-50, 4236 (major), 4220 (major). Resistance Levels Resistances are: 4422-25 (major), 4432, 4442 (major), 4448, 4465 (major), 4473, 4486-90 (major), 4500, 4511 (major), 4517, 4527, 4542 (major), 4560, 4575, 4580, 4585 (major). Trading Plan My trading plan is to be very cautious today, especially after a big, one directional move, below major resistances. Longs are risky (chasing into a resistance), and price loves to chop hard in these zones. I will be picking my spots very carefully and patience will be key. I will not be trying to predict the action, but rather react with no preconceptions. Wrap Up In summary, bulls aren't out of the woods yet by any means, but the fact we spent two days basing now is a healthier sign. My general lean is we can base build now 4392-4420s. This would set up a push to 4442+. If 4392 fails today, it's a big warning sign and I'd be quite cautious on longs below there. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro
8/21 Daily Recap, Outlook, and Trading PlanRecap This week has been a masterclass in what I call “Technical Analysis 101”. The most significant technical event of 2023 occurred on Tuesday, with ES breaking down the uptrend channel connecting the March and May lows. This resulted in a 100+ point multi-day selloff, the deepest since before the March low. However, ES managed to put in a green recovery day on Friday, in the form of a bullish hammer candle. Premarket 🌏 Asia: Down 🌍 Europe: Up 🌎 US Index Futures: Up 🛢 Crude Oil: Up 💵 Dollar: Down slightly 🧐 Yields: Up 🔮 Crypto: Down World Headlines The People’s Bank of China (PBOC) lowers short term loan rates slightly but disappoints markets by leaving longer term rates steady. Key Structures The large rising uptrend channel in white, connecting the March lows and the May lows, is the primary medium term channel. It failed on Tuesday this week, resulting in a significant sell-off. Other key structures include the declining channel in yellow and the resistance of the yellow trendline connecting the December and January highs. Support Levels The major support levels to watch are 4370, 4340-42, 4315-4305, and 4260s. These levels provide context to the daily price action and are not meant to be predictive. Resistance Levels The major resistance levels to watch are 4402, 4420-28, and 4487-90. Clearing these resistances would be a big structural win for bulls and could potentially lead to a recovery. Trading Plan In terms of resistances, I’d prefer to try shorts at the 4418 and 4428-30 cluster. Wrap Up Bears remain in control and any bounces are only relief until proven otherwise. My lean is that we can bounce more, to 4404, then perhaps 4420s before trying lower. If ES can clear that 4420-30 resistance cluster, there is a case for a more sustained bottom. 4370 fail triggers down direct. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!Short
by spytradingpro
8/18 Daily Recap, Outlook, and Trading PlanRecap The bears had their first major technical win since mid-February, breaking the perfect rising trendline from the March lows. This has triggered a "sell the bounce" theme with the bulls struggling to put in green days in August. The question now is whether there is a relief bounce on the horizon. Premarket 🌏 Asia: Down 🌍 Europe: Down 🌎 US Index Futures: Down 🛢 Crude Oil: Down 💵 Dollar: Up slightly 🧐 Yields: Down 🔮 Crypto: Down World Headlines Major Chinese property developer Evergrande is back in the news, this time filing for Chapter 15 to protect it during restructuring. Key Structures The declining channel extending from the July 27th high broke down on Tuesday, starting the cascade lower. The large rising uptrend channel, which connects the March lows and the May lows, also failed late Tuesday. This was the first technical success bears have had since March. Support Levels The most immediate major support that failed is now the immediate squeeze trigger on the reclaim of 4404. Other support levels include 4369 then 4340-45. Resistance Levels The backtest of the declining channel is now 4438 and was where we rejected yesterday. To set a "bottom", the large rising uptrend channel has to reclaim and currently, resistance is at 4480ish. The 4463-66 level we broke down from on Tuesday would likely also count as an early reclaim and is also significant. Trading Plan The plan for today is to continue to sell the bounce. A sustained bounce will only come when a resistance clears. The two big ones are now 4393 then 4404. A short squeeze could occur if we can reclaim that 4404. Wrap Up Bears remain in control. The general lean is that ES can test 4369 next level down, then perhaps try another sustained bounce there and if it can’t reclaim 4393 then 4404, we simply continue lower down to 4340. A squeeze could occur above 4404. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!Short
by spytradingpro
8/17 Daily Recap, Outlook, and Trading PlanRecap August 2023 has been a unique month with 12 trading days, 10 of which were red. Tuesday, ES hit its most significant support level, leading to a continued grind down. This triggered shorts Tuesday for a breakdown trade, which finally followed through yesterday afternoon. After 10 of 12 days red, the question is whether the bulls can get a relief bounce and where. Premarket 🌏 Asia: Mixed 🌍 Europe: Down slightly 🌎 US Index Futures: Up 🛢 Crude Oil: Up 💵 Dollar: Down 🧐 Yields: Up 🔮 Crypto: Mixed World Headlines 8:30am Unemployment Claims 240K expected, 239K reported. The number of individuals who filed for unemployment insurance for the first time during the past week. 8:30am Philly Fed Manufacturing Index -9.8 expected, 12 reported. Level of a diffusion index based on surveyed manufacturers in Philadelphia. 10:00am CB Leading Index m/m -0.4% Combined reading of 10 economic indicators related to employment, new orders, consumer confidence, housing, stock market prices, credit trends, and interest rate spreads. Key Structures The core structure remains a declining channel in yellow - extending from the July 27th high. Support today is now 4448, and resistance will be 4555-60. The large rising uptrend channel in white, which connects the March lows and the May lows, is the primary medium term channel which broke down yesterday. The reclaim of this structure will be the core objective for bulls in the coming days. Support Levels Supports are: 4424, 4411 (major), 4403 (major), 4394, 4382 (major), 4369, 4358, 4345, 4328-32 (major), 4312 (major), 4305 (major) Resistance Levels Resistances are: 4438-34 (major), 4448 (major), 4464, 4473 (major), 4493 (major) 4500, 4510-14 (major), 4524, 4533 (major), 4542 (major), 4555-59 (major), 4568, 4580, 4591 (major), 4598, 4607 (major), 4613, 4625 (major), 4641, 4657-62 (major). Trading Plan In terms of levels to bid direct, 4411 and 4403 are two very significant supports below here at which a knife catch long could be tried. For spots to add shorts, 4448 is fairly well tested now and may clear if we get back up there. 4473 would be one spot of interest, and 4510-14 would be the best area. Wrap Up This market is impossible to predict and I am in reaction mode. My loose lean if I had to give one is we sell to 4411, perhaps 4403 then try a rally there up the levels to 4448. We could see a green day off this but bulls will need to reclaim 4448 to have accomplished anything significant. 4403 fails, we start the next leg direct to 4383. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro
8/15 Daily Recap, Outlook, and Trading PlanRecap As predicted, we saw a push to 4515 major resistance followed by a dip in the ES. This was no surprise as ES remained stuck in a 1.5 week bi-directional range, the largest of its type since May 2023, and December 2022 before that. Late in the day, we finally broke the range down. Premarket 🌏 Asia: Mixed 🌍 Europe: Down 🌎 US Index Futures: Down 🛢 Crude Oil: Down 💵 Dollar: Up slightly 🧐 Yields: Up 🔮 Crypto: Down World Headlines Chinese central bank cuts interest rates in surprise move on more weak economic data. Michael Bury spooks investors with new big short. 13F filing shows he bought $1.6B of puts on SPY and QQQ. Fitch analyst warns of coming US banking downgrade. Key Structures We remain in an extremely choppy range between 4515 and 4459. This level was a major, multi-month trendline and after a full day of chop, it finally cracked. This is the most significant technical breakdown in many months. ES has now been red for an incredible 9 of the last 11 days. The core structure remains a declining channel in white - extending from the July 27th high. Support tomorrow is now 4454, and resistance will be 4562. Support Levels 4454 (major), 4448, 4438, 4430 (major), 4423, 4416, 4400-4405 (major), 4395 (major), 4382, 4368, 4350, 4339 (major), 4327, 4312-15, 4306 (major). Resistance Levels 4461 (major), 4468, 4474, 4487-90 (major), 4505-08 (major), 4522 (major), 4534, 4545-50 (major), 4562 (major), 4568, 4579, 4591, 4597 (major), 4608 (major), 4621, 4634, 4650-52 (major), 4660, 4672, 4680, 4692-95 (major), 4705-4710 (major). Trading Plan Bears control until we can reclaim the area we broke down today, which is roughly 4461 now. I would be looking to trade the reclaim of this zone. If we can reclaim that white channel at 4461ish now, it will provoke a violent short squeeze and possible multi-week/month low. This would probably see a push back to 4505, dip, then onto 4560s. On the bearish side, bears control under 4461-68 zone now. Generally the bearish path here would have 4400 as a magnet with level to level bounces on the way down. Wrap Up Bears made a play for it today by cracking the 4461 level, and the coming hours will be key to see if its a real or failed breakdown. I will react accordingly. My loose lean is we can make our way to 4438, perhaps 4430 then try a larger bounce there. If 4461-68 reclaims, bottom is probably in. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro
8/14: Daily Recap, Outlook, and Trading PlanRecap July, the second most bullish month of the year, saw three consecutive weeks of growth, rallying 220 points. August started with the first red week in three, followed by a more turbulent descent this week. However, August is traditionally a consolidation month, with a 0.1% average return over the past 20 years. This pattern of a choppy first half and stronger second half has been evident this year, with ES making slight new lows then squeezing all week. Markets Overnight 🌏 Asia: Down 🌍 Europe: Down 🌎 US Index Futures: Down 🛢 Crude Oil: Down 💵 Dollar: Up 🧐 Yields: Up 🔮 Crypto: Up World Headlines Renewed concerns about the health of China’s economy as it’s largest private wealth manager missed payments Key Structures The core structure is a declining channel in yellow, extending from the July 27th high. This is a bull flag, however, it only becomes one on the breakout. Patterns exist only as probabilities until they confirm. Support of this is now 4465, and resistance will be 4580. Other important structures include the major June/July resistance that started the current leg up, shown in purple below, and the large rising uptrend channel in white, which connects the March lows and the May lows. Support Levels Supports are: 4480, 4474, 4464 (major), 4457 (major), 4448, 4435, 4426 (major), 4410, 4395-4400 (major), 4388, 4380, 4367-70 (major), 4350, 4339, 4322, 4305-10 (major), 4288 (major). Resistance Levels Resistances are: 4493-88 (major), 4500, 4509 (major), 4518 (major), 4532, 4545 (major), 4555, 4564, 4568-71 (major), 4580, 4587-92 (major), 4607 (major), 4618, 4633, 4644 (major), 4665, 4670, 4681-84 (major), 4692, 4704 (major), 4724, 4733 (major), 4750-55, 4770 (major). Trading Plan The bull case today depends on the 4457 zone holding, and ideally, it does not even test again. An ideal bull case would look something like ES continuing to base between 4475 and 4488-93, then pushing up to 4509, 4518, then dipping again before tackling 4545. The bear case begins on the fail of 4457. Shorting here is a break-down trade, which requires a good read of the price action to execute well. Wrap Up We are currently in a choppy phase. The loose lean is that we can continue to base above the 4457 level and below 4492, then try to push up the levels again to 4509 then 4518. A dip there is likely. If 4457 fails, shorts trigger for a large leg down - and this leg could last days. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro
8/11: Daily Recap, Outlook, and Trading PlanRecap Yesterday, CPI delivered as expected with plenty of large, bi-directional swings and traps. Despite this volatility, ES followed the general trade plan well, defending the 4493 support zone and continuing the rally to high 4530s. The market closed right at the 4493-88 level, which has been tested six times since last Friday. Markets Overnight 🌏 Asia: Mostly down 🌍 Europe: Down 🌎 US Index Futures: Down 🛢 Crude Oil: Up 💵 Dollar: Up slightly 🧐 Yields: Up 🔮 Crypto: Down slightly World Headlines Producer Price Index reports higher than expectations. Key Structures The core structure remains a declining channel, extending from the July 27th high. This is a bull flag, however, it only becomes one on the breakout. Support of this is now 4467-69, and resistance will be 4580. Support Levels The support levels for today are 4475, 4467-69 (major), 4452-55 (major), 4446, 4438, 4431, 4423 (major), 4413 (major), 4397-4401 (major), 4383, 4367 (major), 4351, 4338 (major), 4327, 4317, 4310 (major). Resistance Levels The resistance levels for today are 4492-88 (major), 4500, 4509-13 (major),4522, 4527 (major), 4539, 4543-46 (major), 4554, 4560 (major), 4570, 4580-85 (major), 4592, 4598, 4608 (major), 4617 (major), 4625, 4635, 4643 (major), 4650, 4657 (major), 4665, 4681 (major). Trading Plan The bull case today would involve ES defending the 4469-67 zone lowest, then reclaiming that 4493-88. From there, we’d make the same trip - back to 4509, dip, then up again to 4540s. If we do flush again today, 4450 is the last shot for bulls. The bear case begins on the fail of 4469-67. I’d need to see a bounce or failed breakdown here to drain demand from the level, then I’d consider short perhaps 4466 for the move down the levels. The real sell comes on the fail of 4452-55. After an initial bounce to drain demand, I’d be looking to short the breakdown here perhaps 4445 for a move down the levels. Wrap Up These remain complex conditions, but also prime conditions for traders who just trade the levels and aren’t focused on trying to predict the price action. My general lean for today is that ES can defend that yellow flag support (4469 lowest), then reclaim 4493 to try back up to 4509+ again. If 4469 fails, we test 4450. Real selling starts below. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro
8/10: Daily Recap, Outlook, and Trading PlanRecap The month of August has seen a shift in trading character, with massive bi-directional swings in the ES. The ES made four full round trips from the 4535+ zone down to the 4480-90 zone since Friday alone. On Tuesday, the ES rallied to 4532 then dipped back down to the 4480-90 zone and held. The 4493-88 zone remains the most important area in ES, as it back-tests the zone we broke out from on July 12th, triggering a 3 week rally. Today is CPI day, which are typically the most volatile and difficult trading days of the year. Markets Overnight 🌏 Asia: Mostly up 🌍 Europe: Up 🌎 US Index Futures: Up 🛢 Crude Oil: Down 💵 Dollar: Down 🧐 Yields: Down 🔮 Crypto: Down slightly World Headlines It’s inflation day. US Consumer Price Index inflation prints slightly below expectations at 3.2%. Key Structures The core structure now remains a declining channel in yellow - extending from the July 27th high. This is a bull flag, however, it only becomes one on the breakout. Support of this is now 4475, and resistance will be 4580. Everything inside equals consolidation. Support Levels Supports are: 4493-87 (major), 4484, 4475 (major), 4467, 4459, 4453-48 (major), 4438, 4420-23 (major), 4410, 4395-4400 (major), 4382, 4368 (major), 4351, 4340-45 (major), 4327, 4317, 4310 (major). Resistance Levels Resistances are: 4508-04 (major), 4521 (major), 4528, 4538-40 (major), 4547, 4559 (major), 4569, 4579-83 (major), 4592, 4598-4601, 4614-17 (major), 4624, 4631, 4639-43 (major), 4647, 4660, 4670, 4677-80 (major), 4692 (major), 4705. Trading Plan For CPI days, price can squeeze very hard, through multiple levels so any shorts that are counter-trend must be taken small and at your own risk. The 4538-40 zone remains a strong resistance. If ES were to dip, this is the spot before we head to 4579-83. Bull case today: We are clinging right to that major 4493-88 support zone right as I write this. As long as this general cluster keeps holding, the bull case is alive and well. Bear case today: Begins now on fail of 4475. As always - I don’t chase. I’d need to see a bounce there, followed by a base building. Then I’d consider short perhaps 4472. Wrap Up CPI day - it is not possible to predict and we can easily see 4300s or 4600s (or absolutely nothing). I’ll be reacting and picking my spots. If today were a normal day, my general lean would be that we would keep defending this 4493 support zone (4475 on any spikes down) then continue the rally to 4509, then onto high 4530s. Dip there before higher. 4475 fails, we sell. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro
8/9: Daily Recap, Outlook, and Trading PlanRecap The week started with a squeeze due to ES back-testing the crucial 4493 level from its July 12th breakout. This led to a technically perfect 48 point rally on Monday. However, markets are known to be unpredictable and often trap players in a cycle of relentless dip buying and selling. Tuesday saw a sell-off from Monday's highs down to 4480s, followed by a hard squeeze in the afternoon. The squeeze started once again from the 4487-93 zone. Markets Overnight 🌏 Asia: Mixed 🌍 Europe: Up 🌎 US Index Futures: Up a bit 🛢 Crude Oil: Up 💵 Dollar: Down slightly 🧐 Yields: Mixed 🔮 Crypto: Up World Headlines White House will announce today new investment restrictions in advanced technology industries such as advanced semiconductors, artificial intelligence and quantum computing. Key Structures Several key structures are in place, including a declining channel from the July 27th high, which is technically a bull flag. Support for this is now at 4493-87, and resistance will be at 4581-85. Other noteworthy levels include 4509, which has been a dominant magnet this week, and 4493-87, which represents major June/July resistance. Support Levels The support levels to watch are: 4515, 4505-09 (major), 4493-88 (major), 4475, 4464-66, 4450-53 (major), 4443 (major), 4432, 4420-23 (major), 4411, 4400 (major), 4387, 4370, 4362 (major), 4351, 4345 (major). Resistance Levels Resistances are: 4532 (major), 4540, 4548 (major), 4558, 4574, 4581-85 (major), 4597, 4607 (major), 4614, 4625, 4637-40 (major), 4655, 4665, 4674 (major), 4687 (major). Trading Plan Bulls need to hold the 4493 backtest, and 4509 should continue to hold as well. If 4509 fails, it could lead to a trip back down to 4493-88. For bears, 4509-05 needs to fail. In terms of adding on strength, a nice bull flag overnight below 4520 and above 4509 could lead to a push to 4530+. Wrap Up Bulls defended an important support at 4493, and now need to keep running this. The general lean is for bulls to continue defending 4509, then run to 4530 or so, dip, then 4548. If 4509 fails, it's back down the levels again.
CME_MINI:ES1!
by spytradingpro
8/8: Daily Recap, Outlook, and Trading PlanRecap As predicted in my last newsletter, the ES saw a relief bounce after putting in 4 consecutive red days for the first time since May. I went long late on Friday afternoon at 4493 and we saw a rally from 4493 on Friday to 4522 overnight on Monday, followed by a dip and then a continued rise. This was due to a technical backtest of a 3-week ascending triangle that broke out on July 12th. Markets Overnight 🌏 Asia: Mostly down 🌍 Europe: Down a lot 🌎 US Index Futures: Down a lot 🛢 Crude Oil: Down 💵 Dollar: Up 🧐 Yields: Down 🔮 Crypto: Up a bit World Headlines China CPI and PPI data show deflation becoming a serious concern Moody’s downgrades numerous US regional banks and puts six larger banks on watch Key Structures The core structure now is a downtrend channel, extending from the July 27th high. This is a bull flag, with support at 4493-87 and resistance at 4592. Inside this structure, the 4550 zone and the 4528 level are noteworthy. The large rising uptrend channel in white, connecting the March lows and the May lows, is the primary medium-term channel. Support Levels The major support levels are 4527, 4509, 4493-87, 4475-70, 4448-51, 4438, 4421, 4397-4402, 4350-55, and 4307-4311. Resistance Levels The major resistance levels are 4538, 4556, 4577-80, 4591, 4620, 4634, 4668. Trading Plan I'm still holding my leftover 10% runner from 4493 and will only add if we get a good dip. After yesterday's rally, I think tricky, tactical, back and forth action is likely today. The best entry would be if we clipped 4509 support then popped to 4515. I'm not interested in buying the 4509 again as it's no longer a fresh level. In terms of shorts, I favor 4556 and 4577-80. Wrap Up While we dip today, bulls will want to defend that 4509 support at the lowest. The direct bull case would look something like holding above 4527, popping to 4549 or 4556, then heading up to 4577-80. The short-term bear case begins with the fail of 4509. I think things likely get tactical today, rewarding level to level day traders only with no bias. Expect bi-directional action. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro
8/7: Daily Recap, Outlook, and Trading PlanRecap August started off with a bearish week for ES, marking its first red week in a month. The month is historically bearish at the start but bullish towards the end. Last week saw a rare three consecutive red days, a pattern only exceeded once since the March low. A relief bounce was anticipated, with a target of 4550, which played out as expected. ES then experienced its 4th red day in a row last Friday. Markets Overnight 🌏 Asia: Mixed 🌍 Europe: Down slightly 🌎 US Index Futures: Up 🛢 Crude Oil: Down 💵 Dollar: Up slightly 🧐 Yields: Up a bit 🔮 Crypto: Mixed World Headlines Bond market volatility continues as Fridays strong bounce is starting to look like a dead cat bounce this morning. Key Structures Several main structures are being monitored, including a new downtrend channel extending from the July 27th high. This is technically a bull flag, but only becomes one on the breakout. Inside this structure, the 4550 zone is significant, having been tested three times and failed, triggering a 50 point sell. The 4524 level is another critical point, acting as support for the ascending triangle that broke out on July 12th. Support Levels Key support levels include 4493, 4487, 4475-73, 4461, 4448-53, 4443, 4425-30, 4413, and 4395-4400. Resistance Levels Resistance is found at 4509, 4515, 4520-24, 4534, 4538, 4547-50, 4555, 4567, 4578-80, 4585, 4592, 4597, 4609, 4617, and 4624. Trading Plan A small long position was taken at the 4493 level last Friday. If this zone fails, the market could free fall again, with the "major" zones being potential knife catch spots. For the bulls, the key hurdles are 4509 and 4524. For the bears, the case begins on the loss of 4487. Wrap Up While bears remain in control, there is caution over short-squeeze risk after four consecutive red days. The general lean for today is that ES can hold the 4487-93 zone, then try to retest 4520-24, perhaps with a small dip, then try higher. If 4487 fails, the market could continue downward. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro
8/4: Daily Recap, Outlook, and Trading PlanRecap As we've moved into August, we've seen a shift in the “character” of ES, with volatility returning and large, bi-directional swings in the market. Despite this, it's important to note that August is not a “bearish month” but rather a seasonally neutral month, with a +0.1% average over the last 20 years. The focus for this month will be on tactical, unbiased level to level day traders. Markets Overnight 🌏 Asia: Up 🌍 Europe: Down a bit 🌎 US Index Futures: Up a bit 🛢 Crude Oil: Up a bit 💵 Dollar: Down 🧐 Yields: Down 🔮 Crypto: Up slightly World Headlines Bond market showing early sign of stabilizing. Key Structures The core pattern containing the entire consolidation since the July 19th high was a broadening formation, which broke down on Wednesday. This pattern suggests that bears control below and bulls control above. Other key structures include the rising support trendline of the purple ascending triangle and the large rising uptrend channel in white. Support Levels Key support levels include 4525, 4517, 4509, 4493, 4487, 4476, 4464, 4448, 4441, 4428, 4411, 4395-4400, 4382, and 4376. Resistance Levels Resistance levels to watch are 4534, 4542, 4550-53, 4560, 4565, 4577-80, 4583, 4592, 4599, 4607-09, 4618, 4623, 4630, 4639, 4650, 4661, and 4671. Trading Plan For today, the short-term bull case depends on the 4509 level continuing to hold. The bear case begins if the 4509 level fails. As always, it's important to plan your zones of engagement in advance, wait for entry setup, take a level to level piece, then reset bias from scratch, and get to the sidelines. Wrap Up With the return of volatility, August is shaping up to be an interesting month for traders. Key levels and structures have been identified for both bull and bear scenarios, and as always, the focus should be on tactical, unbiased level to level trading. With Apple earnings expected to introduce some volatility into the market, it will be important to stay reactive and flexible in your trading approach. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro
8/3: Daily Recap, Outlook, and Trading PlanRecap The last newsletter discussed the potential for bearish seasonality in August for SPX. This was timely as volatility was unleashed shortly after the newsletter was sent out. The catalyst for the volatility and selling was the US credit downgrade, which triggered a loss of critical multi-day support. This led to the most eventful evening session of 2023, followed by more daytime volatility. Markets Overnight 🌏 Asia: Mostly down 🌍 Europe: Down 🌎 US Index Futures: Down a bit 🛢 Crude Oil: Up 💵 Dollar: Down slightly 🧐 Yields: Up strongly 🔮 Crypto: Down World Headlines The timing and reasoning of the Fitch Treasuries downgrade is being questioned, limiting the downside which was much worse when S&P Global downgraded 11 years ago. Key Structures The core pattern containing the entire consolidation since the July 19th high was a broadening formation, also called a megaphone. This pattern broke down yesterday and will need to reclaim support to trigger any sustained squeeze upward. The next major support down below 4553 is 4508-15. This is the support of the large, purple ascending triangle structure we broke out on July 12th. Support Levels Supports are: 4531-33 (major), 4527, 4516 (major), 4509 (major), 4497-93 (major), 4486, 4475, 4467, 4455 (major), 4441-46 (major), 4431, 4424 (major). Resistance Levels Resistances are: 4543, 4531-33, 4551-53 (major), 4560, 4565, 4575 (major), 4584 (major), 4592, 4599,4606-08 (major), 4613, 4620, 4624-26 (major), 4634, 4644, 4653, 4666-70 (major). Trading Plan For the bull case today, there is no short-term bull case until a resistance reclaims. For now, this is 4551-53 and reclaim there would trigger back to 4575, likely dip there, then probably back to 4605. The bear case today begins on the fail of 4531. One could short this 4527 or so with target of 4509-16. Wrap Up These are level to level traders markets and they are prime conditions. The focus will be on reacting to the action and not making predictions. If a prediction had to be made, it would be a backtest of 4553, perhaps a sell to 4509-16, then a rally from there. Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions.
CME_MINI:ES1!
by spytradingpro