Did Bulls Drop The Ball In SPX? April 13th Plan

In yesterdays newsletter, I wrote how CPI days were the most complex, trap-filled, high complexity days for ES, and today certainly delivered. I wrote yesterday: “One common theme though on CPI days is traps. While not always the case (there is no always in markets) it is quite common for the first reaction move to be a fake. It is for this reason that the failed breakdown is your best friend on these days, and is the main setup I trade”.

This is precisely what happened, with ES initially spiking to 4177 (the trap move) then rejecting. It is *almost* always the case on data days. As readers know, I was positioned long into the meeting from 4137 yesterday, looking for 4165, then 4175 targets which I described as the “dip zone”. This played out nicely initially on the long side for the initial move (the trap) then provided a sell afterwards for those playing the very textbook failed breakout.

Ultimately though, we are still stuck inside that same 4095-4170ish range that has contained price all April. With todays sell though, is it at risk of breaking down? In today’s newsletter, I’ll be addressing this, breaking down my core setup (the failed breakdown) that I traded today, and provide the actionable plan for tomorrow.