An Incredible 6 Green Days In A Row For SPX. Can Bulls Really Do 7? April 30 Plan
Since April 6th (the day that we set the current low of 4835), I’ve begun each newsletter by making it absolutely clear what the theme for ES is: Buy dips mode. Yes, the dips vary in size, duration, speed, and cause, but they get absorbed in a reasonable time frame before price can revisit the lows. As a brief compilation of the dips since April 6th, we had: We had 430 point sell on April 9th, 375 point sell on April 10th, 130 point sell on April 11th, 233 point sell April 16th, and 56 point sell April 17th, last Monday a 177 point sell, last Wednesday a 141 point sell, last Friday a 67 point sell and yesterday we had had a 88 point sell. All were bought.
As I also discussed yesterday though, phrases like “buy the dip” are fairly useless, because one has to know where and how. My system answers this question but identifying the core footprint of institutional accumulation: The Failed Breakdown. All major rallies and squeezes are caused by a Failed Breakdown. When we see one, we know institutions are longing, and we just need to hop on. Case in point: I wrote on Friday at 4pm: “As long as the above supports hold (5492-85 lowest), 5565, 5582, then 5620-25 are next batch of targets.” Yesterday we sold down to 5492-85 exact low of day, put in another Failed Breakdown of a big shelf of lows from Sunday evening at 5515, and squeezed into the close to 5565. However, this meant it was 5 green days in a row for ES, something it has not done since November 2024.
Could bulls keep it going? My lean was yes. I wrote yesterday at 4pm: “We had an incredible squeeze today and 5493 to 5565 remains the range. My general lean is to defer to the trend. We can work this range, then next leg sees 5583, 5610-20, then 5650.” This afternoon we got to 5583+. How much more gas do bulls have in the tank? In today’s newsletter I’ll talk this, I’ll do a deep dive into some of the recent Failed Breakdowns we had including Friday’s & yesterday’s; specifically emphasizing the entry trigger portion of the setup for education. Finally, I’ll discuss the actionable trade plan for tomorrow.