Largest Sell For SPX Since October 17th, 2023. Can It Finish This Week Green?

For the first time since October 17th now - ES put in a four consecutive red day stretch. While four red days in a row is utterly routine and normal in regular trend/bull market conditions, the fact we have gone since October 25th without seeing this only underscores just how extreme and anomalous the recent 2 month rally was. My newsletter letter yesterday was entitled: “A Rare 3 Red Days In A Row For SPX; Bounce Incoming?”. ES tried this morning, but like all bounces in 2024 so far, it was sold as we continue to cool-off following the recent mega-rally.

This bounce came according to yesterdays plan. As readers know, I got long right at the close yesterday at 4744, writing: “I decided to try a knife catch long in the key 4744…We are 4746ish as of writing, but if we get down to 4738 I’d likely be willing to add the rest of the trade with a fairly tight stop. These two levels (4746 and 4738) will be key tomorrow.” This played out nicely, and this morning we dipped to 4738, almost exactly, resulting in an excellent 30+ point tradeable rally. I wrote yesterday: “My general lean for tomorrow is as long as 4746, 4738 lowest hold, we can try a bounce back to 4767-71” and we rallied from 4738 to 4767 today then sold again down to new lows.

Can bulls finish the first week of 2024 with a bounce? In today’s newsletter I’ll talk this, go over in detail the setup that got me short for yesterdays selloff (its the rarest, most difficult of my three trade setups), then discuss the actionable trade plan for tomorrow