Is The Bottom In For SPX? August 24th Plan

Note: This is a re-send. The chart on the newsletter sent out 10 minutes ago was incorrect.

As readers recall, I went into this week looking for a relief bounce in ES. There was a multitude of technical reasons for this as discussed extensively, but the core reason was one of the most basic technical reasons there is. On Friday, after three straight red days, ES put in a classic, bullish daily hammer candle. This is one of the first things most learn when opening a book on technical analysis.

That candle has marked a major low with ES managing three days of higher daily lows off it. I was looking for another pop higher today. I wrote in yesterdays newsletter: “My general lean though is that since 4390 has not failed yet, that ES can try to continue the relief bounce to 4418, high 4420s” adding, “This pathway would look something like test 4390 one final time, then reclaim 4400 to run back to 4418 then 4426-29. Dip there, then run higher”. This is precisely what played out, and what did we do today? We reclaimed 4400 last evening after a dip under it late day yesterday, then ran to 4426-29 target, then continued up. 4426-29 was a squeeze trigger as written yesterday, and squeeze it did. Multiple long entries for this were provided in yesterdays newsletter.

We are now 100 points off last Friday’s low though, which some big catalysts ahead (NVDA earnings + Jackson Hole on Friday). Is the bottom in? In today’s newsletter I’ll talk this, I’ll then go over the setup that triggered today’s squeeze as it was one of the best moves in several weeks. I’ll then provide the actionable trade plan for tomorrow.