SPX Has Snapped A 6 Week Long Bullish Streak.What Does It Mean? March 15 Plan

As I’ve discussed here daily all year, ES has been locked in a very stubborn cycle, where it typically spends the first half of the week chopping in ranges, before what has typically been a Thursday squeeze higher. ES has done this now every week for 6 weeks, with the last three Thursdays seeing 75, 55 and 85 point rallies respectively. Today, ES finally managed to kick this cycle and diversify the price action, putting in a dream market for day traders with good, bi-directional action, that closed with a nice sell lower, marking a rare red day.

I frequently say the benefit to being a day trader as opposed to swing trader or investor, is there no shortage of moves. Case in point, I wrote yesterday: “Bear case tomorrow: Begins of the fail of 5220…. I’d consider short 5217 for a move down to 5202”. At 10am, we lost 5217 and sold to 5202 low of the morning. I then wrote yesterday: “If we get a firm sell down tomorrow, I am only interested in trying to catch points at the levels marked as major. 5202, 5183, 5156 are of particular interest”. We sold down to that 5202 buy point, and bounced 25 points, before continuing the “bear case” scenario lower to new lows into the afternoon, followed by a late day closing squeeze right back to 5220. As mentioned, dream market for day traders, and there were quite literally a dozen setups today, which is highly unusual.

The question though, is where does this leave us and will bulls pick the slack up tomorrow? In today’s newsletter I’ll talk this, I’ll then discuss an important variation of my core setup, the failed breakdown. This is key to understand to broaden the types of setups you can engage. Finally, I’ll discuss the actionable trade plan for tomorrow.