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Morning everyone. Today is Tuesday, November 3rd, and yesterday was another absolute banger. In the weekend review, we called the Daily at 7697.00 as well as the 4-Hour at 7689.50, which aligned perfectly with our gamma flip level at 7693.00. Price moved up on ES and played this level to perfection, sending us down well over 120 points in the cash session. All the while, SPX had beautiful confluence, popping directly up into our big major Daily/4-Hour level at 7659.44. This was perfect confluence for us, as it allowed us to get short with confidence and ride this bad boy down. Congratulations to all those who took advantage of a beautiful Monday. A lot of money was made by Trade Plan subscribers and inner circle holders, and I received plenty of thank-yous — we have defied all odds by maintaining our bearish stance while the rest of the world continued to point up, only to be very disappointed and have portfolios hurt. Congratulations to those who followed the plan and took advantage of the opportunities before us.
We have been drifting lower all day, just as our plan presumed yesterday in the post-market breakdown. We held the 7575.25 1-Hour at the close yesterday, and then price drifted down in the overnight session, only to sweep our leg low from last Friday — exactly what we anticipated was going to happen. Once again, the trade plan delivers. As we sit here in the overnight session, we are balancing underneath this major pivot at 7575.25, which will be an important above/below spot for us this morning, and we are holding the big major Daily at 7553.25. This Daily is a monster, and it is tested, but it is very significant, as it sits with a Put Wall at 7552.00. It is currently holding price up in the overnight session, but my belief is that it will not hold forever. We are down 15 points at the time of this writing.
A Note on Today’s Market:
News: We have one Red Tag news event, and it is absolutely important: the congressional elections today — the midterms. This is guaranteed to provide volatility, as it has every four years. This is a massive event, as the Democrats and the Republicans fight for control of the House. At 10:00 a.m., we also have JOLTS Job Openings, which is not a Red Tag event but is absolutely important regardless. We’re going to be very cautious today, as we could get a lot of volatility based on intraday news from the election. Be very careful, size appropriately, and wait for the trades to come to you.
Volume: We come in this morning with elevated Relative Volume of +34.5%. Using our relative calculation, that means we could get approximately 58 points today above or below the overnight highs or lows. Definitely look for an extended move today, as today’s volatility is sure to bring some excitement.
Range: Expected range of 89 points. We have already moved 45.5 points in the overnight session, leaving us approximately 43.5 points left in the tank above or below the overnight highs or lows — closer to 58 points with relative volume factored in.
Gamma: We are still in a Negative Gamma regime, as the gamma flip level is at 7702.00, essentially above yesterday’s high. Dealers are expecting more downside as they continue to hedge their positions to the downside, giving us the possibility of increased volatility, oversized ranges, and money to be made in both directions.
Trend: Down. We are still pointed down on the Weekly, Daily, 4-Hour, and 1-Hour timeframes, sending us still lower into our lower significant targets, just as we talked about well over two or three weeks ago. We have been pointed down for weeks now — while the rest of the market has been looking up, we have been paid handsomely for our analysis.
🧠 Current Market Context
The Friday Low Sweep & The Squeeze-to-Smack Setup
VIX maintained its very bullish stance in the overnight session, leading us to believe we could potentially get more downside, at least temporarily. We do need to be careful with the long game, however. We are still technically pointed to the downside, so even though we may squeeze a little today after sweeping Friday’s lows, we need to be aware that we are still pointed down. Regardless of whether we get an intraday pop or not, all pops are sellable at this point in time.
