Another Day, Another All Time High For SPX. Volatility This Week? Dec 9 Plan
NOTE: This is the newsletter for Monday December 9th, originally sent out on Friday at 4pm, for those who did not receive.
The last two weeks were relatively historic in ES in both a price action perspective and a personal perspective. After putting in the most bullish month of 2024 in November, ES put in higher highs for the last 14 days in a row (that is to say, cleared its prior days high). As a result of this, I had been a singular long runner since November 25th at low 5990s -until it finally trailed out yesterday- something I had confirmed to readers everyday at the close since then.
The most recent leg up took us to 6102-06 which has been a major resistance shelf. I prepared readers for this on Tuesday at 4pm (when we were 6060s), 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.” By Wednesday, we ran to 6102-6106, which remained the ceiling into yesterday.
Then yesterday, we finally got a rare micro dip, selling about 30 points from high to low for the largest dip since November 27th (and its a testament to how parabolic this market has been that 30 points is a large dip for that time span). This took us to 6080 or so, but like every other dip, this was bought. I wrote yesterday: “My general lean is always to defer to the trend. Bulls want to hold 6065 on dips tomorrow (and if they are very motivated 6088 won’t even fail). This will keep the train going, with 6100, 6112, then 6132 next up….In terms of spots to add on strength, the recovery of the 6088 zone is of interest.”
We recovered 6088 this morning, and rallied to a new All Time High. ES remains locked in a buy every dip rally. Can it continue next week? In today’s newsletter I’ll talk the levels below which we could get some volatility, I’ll do a deep dive into my concept of control which lets me know who controls (bulls or bears) when it switches, and when it switches back. This keeps me on the right side at all times and not fighting. Finally, I’ll discuss the actionable trade plan for tomorrow.