CPI Incoming Tomorrow: Expect Volatility in SPX. April 10 Plan
Most days this year, I have started this newsletter with a big picture reminder (after all, the dynamics of intraday action flow from the big picture macro trend), and that reminder is that all year, ES has been in what I call a “buy all dips regime”. They vary in size, but this year they have so far all been bought after two red days, and on rare occasions three. The last major sell Thursday was a big one: The largest of 2023 by a big margin, and it was bought. Today also a dip and it was (as always, bought).
As readers know, I’ve been holding long runners since Thursday evening ~5196, which I provided to readers at that time by writing: “On a short-term evening basis, if we can tag something like 5190 then reclaim 5196 I may also look long”. After a 75+ rally from this on Friday, we have, since Monday, been in consolidation mode and after a pop to 5274 resistance this morning, we got another dip. I wrote yesterday: “Below there, we could flush and I am only interested in catch points at the majors (tests of 5207 or that reclaim 5212 are of interest)”. We hit 5208, this setup played out incredivbly well, and this dip was bought for 60+ points.
All of this is ultimately irrelevant though, as tomorrow is CPI day. CPI days are the most volatile, technically significant, difficult, and important days of the year for ES. Can bulls keep the dip buy regime going? In today’s newsletter I’ll talk this, I’ll then do a deep dive into two examples of my core setup (one that got me long Thursday for the 75+ point long and one yesterday that got me long for the 30 point rally as provided to readers, each with their own educational utility). I’ll then discuss my approach to trading CPI days, and the pattern forming here.