Steepest 4 Day Rally Of 2024 For SPX. How Much Is Left In The Tank? Nov 8th Plan
Today was FOMC day, and we headed into it on the back of the most vicious rally of 2024 running from 5734 Monday to 6013 today. As readers know, this was the best trade of the year for me by a long shot from 5734 on Monday, and the market telegraphed it well in advance. As I frequently say market moves aren’t random. Institutions need to position for these moves ahead of time and accumulate. How do they accumulate? Via my core setup: The Failed Breakdown which is the footprint on the price chart that a large institution is longing. When you see one you know a “whale” just got in, and we need to follow them
We got this on Monday, and on Monday at 4pm (when we were 5744) I wrote: “There is an active failed breakdown present where we lost the Thursday lows at 5733, flushed it, and recovered. The bull case for tomorrow would be that this zone holds. This means we go no lower than 5734 ideally. From here, we rally up the range”. I then wrote Tuesday at 4pm before the election: “From there, the next leg up would see 5855, 5865, then 5873. Then we can head to all time highs.” Monday evening, we touched 5735, which set the low, then rallied 280 points into todays highs.
I added yesterday: “My general lean if I had to give one is always to defer to the trend. This would mean ES gets bought on any FOMC dips at the supports discussed above, then runs to 5975-80 target. Perhaps reaction there, then onto 6006+”. This morning, we hit 5975-80 major target, then got to 6006+ this afternoon.
After 280 points of essentially straight upside, how much do bulls have left in the tank though? In today’s newsletter I’ll talk this, I’ll do a deep dive into the setups that caused this historic (I don’t think its fully hyperbole to call it that) rally. The setup that caused this was my bread and butter trade, the failed breakdown, and we get them daily, albeit with far less extreme follow through. Finally, I’ll discuss the actionable trade plan for tomorrow.