September 25, S&P500 Plan and Missal
White Elephant
Image 1. Live with the bear die by the self. W. Herzog, Grizzly Man (2005)
Higher highs and lows.
Why would I feature a bear on today’s cover? That’s where you aren’t paying attention - neither were Timothy Treadwell and Amie Huguenard when they finally got got. Well, I don’t know if that’s how it played out exactly, but a reminder that as strategists we choose live in a wilderness shared with bears. Eventually you run into one, especially if you make it a point to do so. And the photo above is about how close we are to the US election.
Gold is again at all time highs, along with the indices - and China! TLT is flushed into the 100 handle drain. Meanwhile WWIII continues apace with hotter (-est?) developments all week. America is headed into another absurdist presidential election. Commodities look to be at the start of a new cycle, and oil is at the fight of its life at 70. Currency manipulators I’m looking at you.
This time really is different. So about that 5795 pivot!
Crow’s Nest
Four days of balance with pressure to the upside and along with that my bias as of writing. I’ll repeat, buyers’ main focus is volume leading to time above 5800, with the 5822 level a possible gate to higher. Sellers were able to break a prior day low but saw no traction below. Such was the case with the C period bear trap which resulted in a look below and fail of Tuesday’s IB low. Sellers look to return within the prior balance value area below 5710 but without strong initiation the path of least resistance remains up.
Image 2. ES balance and daily profiles to Tuesday RTH
The overnight session is uneventful on mixed inventory, contained largely within the prior day value area. Look for buyers to establish themselves above the ONH, and sellers to spend time below the PD value area.
Wednesday Plan and Levels
Pivot 5795. The volatility model is estimating 37 points with 8 points possible overshoot.
a) Early Defense of PDPOC 5785, volume over 5795 targets 5803 which may be defended to 5812 which may see responsive selling. Momentum over 5822 targets 5835-37 at an extreme.
b) Volume below 5773 targets 5762 balance VAL, FOMC spike high 5756 with can see a bid. Momentum could see buying tail 5738 tested. Much further below: 5723 area of selling liquidity for a relief bid and 5711 LVN at an extreme.
c) VIX pivot 15.80. Selling could accelerate with prints over 16.10, with buying favored below 15.40.
Image 3. ES 4H levels
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