11/7 Trading Plan - Tuesday Recap and Day Ahead

Recap

The market has seen an extraordinary seven green days in a row, with ES not only recording its largest single green week since the first week of November last year but also forming a clear bull flag. Yesterday was largely a consolidation day, but it continued the green streak, making it an even rarer six in a row. Today, we tested 4368-66 in the morning, rallied to 4399 minimum, and then rejected there. 

The Markets Overnight

🌏 Asia: Down
🌍 Europe: Down
🌎 US Index Futures: Down slightly
🛢 Crude Oil: Down
💵 Dollar: Up
🧐 Yields: Down
🔮 Crypto: Down

Snapshot

Daily

4-Hour

Key Structures

The ES chart is now very close to some of the most significant multi-month resistances. These include 4433, the core downtrend channel from the August high; 4418-24, a major resistance cluster in October and a major support cluster back in June and August; and 4399, which backtests the exact August 2023 low.

REMINDER: The market has reached an important juncture, as the SPX has rallied back above its 200-day moving average and also reclaimed the long-term secular bull market uptrend line that extends back to the 2020 Covid crash lows. Breaking back above these key long-term technical levels suggests the recent correction may be over and the primary bull market may be resuming. The ability to hold these levels on a closing basis today would be an encouraging technical development and increase the probability that the October lows marked the end of the pullback.

Support Levels

4387-85 (major), 4376, 4367-71 (major), 4356, 4343, 4338 (major), 4326, 4321 (major), 4314, 4302-97 (major), 4290, 4279 (major), 4268, 4258, 4253 (major), 4243 (major), 4230, 4215 (major), 4205.

Resistance Levels

4399-4401 (major), 4412, 4418, 4424 (major), 4430-32 (major), 4440, 4447-52 (major), 4462 (major), 4473, 4481-84, 4496 (major), 4507, 4514 (major), 4520, 4525, 4532 (major).

Trading Plan

The bull case for tomorrow depends on the bull flag continuing to defend, meaning bulls want to hold above 4385, 4367-72 at the absolute lowest. If these hold, ES may have one pop left in it, with the obvious magnet being 4424, 4430-32. The bear case generally begins on the fail of 4367-72, with 4385 failure being an initial warning shot.

Wrap Up

In summary, any upside from here is purely a bonus. Setups are quite scarce up here, but the general lean is that as long as the bull flag defends (4385, 4367-72) ES can see a pop up the levels to 4424, 4430-32 then try a dip. If 4367-72 fails, we dip direct. In higher, we could expect some short-term consolidation to build up energy before heading higher.

Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decision.