10/16 Trading Plan - Friday Recap and Week Ahead
Recap
This week started off with a statistically significant rally, with 4 green days in a row, totaling a 187 point rally from last Friday’s low to this week's high. This made it the largest 4-day green stretch of the year. After 5 red weeks in a row, ES managed to put in its first green week, marking a reversal week. However, after reaching major resistance, ES began a corrective leg last Thursday.
The Markets Overnight
🌏 Asia: Down
🌍 Europe: Up
🌎 US Index Futures: Up
🛢 Crude Oil: Up a bit
💵 Dollar: Down a bit
🧐 Yields: Up
🔮 Crypto: Up strongly
Major Global Catalysts
China’s central bank boots liquidity, leaves rates unchanged.
Key Structures
There are several key structures to note. The first is the 4477 backtest of the yellow triangle structure that we broke down on September 20th. The next is the 4418-24 backtest of the horizontal line connecting the June 26th low with the August 25th low. The 4377-66 zone represents the downsloping blue trendline connecting the June 26th and August 18th lows. The 4336 pivot is the backtest of the 9-month base we broke out on June 1st. Finally, the 4320-22 is the core bull market uptrend line.
Support Levels
4358-55, 4336, 4320-22, 4302, 4277, 4258, 4227, 4200-05. These are the levels that I would consider bidding direct.
Resistance Levels
4376, 4387-90, 4406-08, 4418-24, 4444-46, 4462, 4477, 4493-96, 4508. These are the levels where I would look for reactions short.
Trading Plan
For bulls, the big picture case is in play as long as we are above the core bull market trend at 4320-22. For bears, the case begins on the fail of 4320-22. I don't chase, so my goal is always to get in as close as possible to either a recent high/low, or near a recent base. The best shorts are on bounces or backtests, not on chasing red.
Wrap Up
In conclusion, as long as 4355-58 keeps holding (4345 on any quick spikes down) I favor ES continues to fill out this new three-day range. If we continue selling deeper, 4320-22 is the absolute lowest bulls can see. A failure there puts a retest of 4250 in play.
Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decision
This week started off with a statistically significant rally, with 4 green days in a row, totaling a 187 point rally from last Friday’s low to this week's high. This made it the largest 4-day green stretch of the year. After 5 red weeks in a row, ES managed to put in its first green week, marking a reversal week. However, after reaching major resistance, ES began a corrective leg last Thursday.
The Markets Overnight
🌏 Asia: Down
🌍 Europe: Up
🌎 US Index Futures: Up
🛢 Crude Oil: Up a bit
💵 Dollar: Down a bit
🧐 Yields: Up
🔮 Crypto: Up strongly
Major Global Catalysts
China’s central bank boots liquidity, leaves rates unchanged.
Key Structures
There are several key structures to note. The first is the 4477 backtest of the yellow triangle structure that we broke down on September 20th. The next is the 4418-24 backtest of the horizontal line connecting the June 26th low with the August 25th low. The 4377-66 zone represents the downsloping blue trendline connecting the June 26th and August 18th lows. The 4336 pivot is the backtest of the 9-month base we broke out on June 1st. Finally, the 4320-22 is the core bull market uptrend line.
Support Levels
4358-55, 4336, 4320-22, 4302, 4277, 4258, 4227, 4200-05. These are the levels that I would consider bidding direct.
Resistance Levels
4376, 4387-90, 4406-08, 4418-24, 4444-46, 4462, 4477, 4493-96, 4508. These are the levels where I would look for reactions short.
Trading Plan
For bulls, the big picture case is in play as long as we are above the core bull market trend at 4320-22. For bears, the case begins on the fail of 4320-22. I don't chase, so my goal is always to get in as close as possible to either a recent high/low, or near a recent base. The best shorts are on bounces or backtests, not on chasing red.
Wrap Up
In conclusion, as long as 4355-58 keeps holding (4345 on any quick spikes down) I favor ES continues to fill out this new three-day range. If we continue selling deeper, 4320-22 is the absolute lowest bulls can see. A failure there puts a retest of 4250 in play.
Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decision
