An Incredible *12 Days In A Row* Of Higher Highs For SPX. Can It Manage 13? Dec 5th Plan
It’s been one of the most lucrative moves of 2024. My newsletter yesterday was entitled: 2 Weeks Since The Last Pullback in SPX. How Much Does It Have Left In The Tank? This title was referencing a statistic I cited two days ago whereby for 12 days in a row now, ES has set a new higher high each day. While this is unusual strength, it was not unexpected and the answer to the question of how much more ES has in the tank was - as typical in an uptrend - “more”.
It was not surprising because two weeks ago on Sunday November 24th, ES broke out a two week bull flag and its Charting 101 from there: Two week breakouts lead to two week rallies. I have been long since then, confirming it everyday at the close and writing yesterday: “I am still holding my 10% long runner from the Failed Breakdown last Monday November 25th - which I have updated here daily, and we have yet to have a dip large enough to trail it out via my trailing stop methodology.”
After a making a new All Time High last Friday, ES spent Monday and Tuesday building another smaller bull flag, and I provided three targets for it yesterday, writing: “There is nothing to do but let runners work until a pullback hits. ES is flagging again 6066 to 6035-38. As long as this structure is in tact, we are en route to 6074 target #1, 6082 target #2, then 6102-6106 target #3.” This played out to perfection, and by 8am this morning, we had tagged 6082 target, and we got to ~6102 by the close.
I noted yesterday that “We are still in “breakout mode” from last Friday and it continues until it doesn’t, its that simple.” Many traders let the noise of “macro”, social media, and news obscure from them the simple and infinitely more lucrative reality that raw price is always conveying . In this case, the reality was we broke out: Get long, stay long, until it ends. Can we keep it going though? In today’s newsletter I’ll talk this, I’ll do a deep dive into a very high quality example of my secondary setup type we had on Monday which triggered longs for the week. Finally, I’ll discuss the actionable trade plan for tomorrow.