CPI Day Tomorrow - Volatility Incoming For SPX: May 10th Plan
On Friday, ES put in a 100 point squeeze, which was the second largest single day rally not only of the current bull cycle that began on March 13th, but also since January 23rd, making it one of the biggest green days of 2023. What happens after big, clean one day trend moves? Correction and chop and wrote on Sunday that I was looking for price to begin the “messy, trap-filled post-rally process”.
This has certainly been the last two days which have been nearly identical but just at different price ranges, with both days ping ponging in a 20 point range, with todays range being 20 points lower. Of course though, there is another reason for the recent chop beyond just the technicals, and its because tomorrow is CPI
CPI days are arguably more volatile than FOMC days even as anyone trading the last many remember (Oct, Nov, and Dec’s multi-hundred point moves in a few hours likely fresh in the minds of many). Can last weeks rally continue? In today’s newsletter, I’ll be breaking down how I trade CPI days + what the last few looked like, talking my core setup (the failed breakdown) and providing the actionable plan for tomorrow.