2025-03-20 - priceactiontds - daily update - nasdaqGood Evening and I hope you are well.
nasdaq e-mini futures
comment: Market is contracting and I highly doubt tomorrow will bring the breakout. Next week we will either see the beginning of a big second leg down for the bears or a higher pullback to maybe 21k. The past days market has gone nowhere and mean reversion was the money printer 19900 is the fair price for now and anything above 20165 or below 19600 would surprise me. Market is in total balance but since bulls could not get a decent pullback, bears are favored to continue the bear trend.
current market cycle: strong bear trend but currently in W2
key levels: 19600 - 20200
bull case: Bulls have strong legs from higher lows up to print lower highs. They are quick to exit and lock in profits, since bears have demonstrated strength for 5 weeks straight. This week the pullback should have gone much higher and it was a really bad week for bulls. Likely more pain to come. Whats the likelihood of a strong bull trend day tomorrow? Very, very low. We are in a bear flag on the daily chart and bulls have tried for 3 days now to make higher highs. I doubt it will work on Opex. Many times the market will oscillate around the price where market makers want it to close into Opex. This does seem to be such a week.
Invalidation is below 19604.
bear case: Bears are doing what they needed to, in order to make this bear trend really look like one and a strong one at that. They are currently fine with 19900 and going sideways, knowing that the odds of a trend resumption down are greater for them than a surprise bull breakout.
short term: Neutral around 19900. Bearish below 19600 and bullish above 20200 but the signals would have to be insanely strong for me to take them. Mean reversion was key this week and I won’t do dumb things on Opex.
medium-long term - Update from 2024-03-16: My most bearish target for 2025 was 17500ish, given in my year-end special. We don’t know if we have printed the W1 of the new bear trend or repeat the pattern from 2024, where we sold of very strong to reverse even more strongly and make new all time highs. Market needs a bounce and around 20000/20500 we will see the real battle for the next weeks.
trade of the day: Bars 66 to 86 were strong enough and had 3 legs up. Market then was close enough to previous resistance and bears printed stronger bear bars 91, 5+6, 8 and 15 -17. 18 was the absolute latest you had to get short, since market demonstrated more than enough at that point, that it does not want to go up anymore. Short with a stop above y high was banger.
Could you have taken the long from 19765 up to 20100? Certainly not on Bar 24 or 25 but bar 35 was a huge bull surprise on the open and we printed a double bottom at y low. Longs since bar 36 were decent with 200 points upside potential while stop had to be 150 points.
