Major Volatility Incoming Next Week. Can Bulls Keep The Trend Going? June 10 Plan

Much like May, June started off with a bang. Readers recall that on May 3rd, ES broke out of a massive, month long April bull flag which triggered us to buy dips for the for a 330 point May rally. The end of May saw another pullback which formed (no big surprise) another bull flag. Just like the start of May, June started off with this flag breaking out early this week.

I wrote on Tuesday prior to the breakout: “We are filling out a large bull flag still with 5209 support, 5298-5302 resistance, and a 5272 key mid-pivot. My general lean is always just to defer to the trend, as long as we continue defending supports, we can push to 5308, 5322, 5329, then 5341+”. Right on cue on Wednesday, we broke it out, and the squeeze began, commencing another phase of dip buying. Today the dip buying continued after jobs report this morning. I wrote yesterday: “Failed breakdowns are your best friend post data release” and after NFP we put in a textbook failed breakdown, flushing yesterdays lows, reclaiming triggering longs again, and resuming up.

I concluded my newsletter yesterday by writing: “My general lean is always to defer to the trend. 5372-5341 is a major chop zone now”. Today, below this zone and above this zone multiple times, to close right back dead in the middle of it. Next week, we have CPI and FOMC both on the same day which will decide what way this goes. Can bulls keep the trend going? In today’s newsletter I’ll talk this, I’ll go over the setup that got me long yesterday/today as they were good examples of my two core setups: Failed Breakdowns, and back-tests. Finally, I’ll talk the actionable plan for tomorrow.