It Was a “Sell Every Rally” Type of Day
What does Thursday have in store?
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Our View
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A two-day respite for the S&P ended with a down 1.43% day. This is what happens when people become complacent and lose focus.
While there is a big laundry list of problems, the elephant in the room is Israel and its Gaza offensive. I understand the carnage, but why was Biden in Israel saying the US has their back and then start pushing to slow it down?
The answer is easy…the world is screaming don’t do it that too many people will die. I don’t think the Israelis give a shit what anyone says, they will make up their own minds no matter what the US says.
Our Lean
When the ES closes weak, it generally rallies on Globex and if they hold into the 9:30 ET futures open, you can usually sell it or the early rallies. And in most cases (not yesterday) you can buy the lower opens and sell the rallies.
The bottom line is the same thing I’ve been saying: keep selling to 30 to 50-point rallies.
If the ES goes down in the first part of the day and takes out 4200 or lower, I would start looking for a European bounce into their close. The big show will be FRYdays option expiration and the end of the month next Monday and Tuesday. I’m still looking for 4100.
For those of you who like HandelStats levels, here they are:
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Upside: Trade and hourly close above 4183 targets 4207.85, then 4:15 settlement at 4215.25, then 4222.25. Hourly close above there targets 4229.75, hourly close above there targets 4243.76, then 1 sd at 4254.37.
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Downside: Trade and hourly close below 4179.25 targets -1 sd at 4176.13m, then 4169. Hourly close below there targets 4152.60. Trade and hourly close below 4140.75 targets -2 sd at 4137. Hourly close below there targets 4120.75, then 4105 — then the measured target 4099-4097.35 area.
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Side note: The ES is currently trading lower, which puts the $SPX cash around 4160 which would be down -9.70% from the year high. The $NDX currently trading lower, Cash at 14245 would be down -10.59% down from the year high.
MiM and Daily Recap
ES Recap
The ES traded up to 4274.00 on Globex and opened Wednesday’s regular session at 4253.50. After the open, the ES traded 4256.00 and then sold off down to 4229.50, up-ticked and did a sideways-to-lower back-and-fill from 4230.50 to 4224.25 until 10:39 when the ES got hit with a buy program that pushed the future up to 4245.50 at 10:49. From there, it pulled back to 4234.25, traded up to 4248.75 at 11:06, then traded in a stutter step price action down to 4203.75 at 1:51.
The ES traded up to 4217.00, dropped down to a higher low at 4204.75 and traded up to 4218.50 at 3:34 as the early imbalance showed small to sell. After the selloff, the ES traded up to 4276.75 and traded 4274.25 as the 3:50 cash imbalance showed $234 million to sell and traded 4210.50 on the 4:00 cash close. After 4:00 the ES traded up to 4290.50 and settled at 4270.25 on the 5:00 futures close, down 61.50 points or 1.44% on the day.
In the end, if you do a time and sales of these posts I think it will give you a good idea of the tone — it was a “sell every friggin’ rally” kind of day! This is how I push and prod the chatroom.
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IMPRO: Dboy :(9:46:24 AM): The ES traded 4290 and today it will trade 4190
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IMPRO: Dboy :(9:47:36 AM): today is one of these days where they go straight down
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IMPRO: Dboy :(10:01:21 AM): Rule no 1 Hold shorts
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IMPRO: Dboy :(10:01:42 AM): Rule no. 2 Add on RIPS
In terms of the ES’s overall trade, volume was steady: 253k traded on GlobeX and 1.65 million traded on the day session for a total of 1.903 million contracts traded.
Technical Edge
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NYSE Breadth: 27% Upside Volume
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Nasdaq Breadth: 24% Upside Volume
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Advance/Decline: 22% Advance
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VIX: ~$21
S&P 500 — ES Futures
ES
Levels from HandelStats.com
ES Daily
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Upside: Trade and hourly close above 4183 targets 4207.85, then 4:15 settlement at 4215.25, then 4222.25. Hourly close above there targets 4229.75, hourly close above there targets 4243.76, then 1 sd at 4254.37.
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Downside: Trade and hourly close below 4179.25 targets -1 sd at 4176.13m, then 4169. Hourly close below there targets 4152.60. Trade and hourly close below 4140.75 targets -2 sd at 4137. Hourly close below there targets 4120.75, then 4105 — then the measured target 4099-4097.35 area.
NQ
NQ Daily
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Upside: Trade and hourly close above 14331.25 targets 14489.25, then 14553.62. Hourly close above there targets +1 sd at 14663.38, hourly close above there targets 14767.25, then 14786. Hourly close above there targets +2 sd at 14837.51.
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Downside: Trade and hourly close below 14331 targets 14321, then -1 sd at 14315.12, then 14307, then 14282. Hourly close below there targets 14159.25, then -2 sd at 14140.99. Hourly close below there targets 14030.25, then -3 sd at 13966.86.
Economic Calendar
Disclaimer: Charts and analysis are for discussion and education purposes only. I am not a financial advisor, do not give financial advice and am not recommending the buying or selling of any security.
Remember: Not all setups will trigger. Not all setups will be profitable. Not all setups should be taken. These are simply the setups that I have put together for years on my own and what I watch as part of my own “game plan” coming into each day. Good luck!
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