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Morning everyone. Today is Thursday, October 29th, and we come off another wild day in the trade plan, as it played to perfection even with the FOMC volatility. SPX held our highest, most untested leg at 7757, and ES popped all the way up to play the 7821.75 Daily, only to fail to gain the highs. On both the 4-Hour and the 1-Hour, after all of this massive squeeze up, we have still yet to see any type of support gained by the bulls.
Yesterday was a beautiful example of the process. We maintained our long-term bearish stance, but we knew that if VIX stayed underneath 17.44, we could continue to push higher — and that is exactly what happened, as we held our 7753.50 Daily, which continued to push us to the upside. However, we continued to play our shorts at the 7785.00 4-Hour and the Daily at 7791.00, and they continued to pay until, at the end of the day, price popped all the way up, swept the liquidity above our 7803.00 Weekly area, and grabbed the Daily at 7821.75 — only to come down hard at the close and fail to gain, just as the plan foretold. It was a glorious day for trade plan subscribers who remained patient through this massive squeeze up.
As we sit in the morning session, we find ourselves balancing sideways after yesterday’s failure to gain support, and we continue to bump our head on the 7772.75 Weekly. This has been a massive pivot for us and will continue to be so today, as it is also located directly with the overnight high and yesterday’s point of control. We’re going to use it as a significant above/below pivot today, as downside momentum will continue to increase as long as we stay below it. We are continuing to slide to the downside, down 37 points at the time of this writing.
A Note on Today’s Market:
News: We come into the morning with Red Tag news. At 8:30 a.m., we’ve got Advance GDP q/q, the Core PCE Price Index, and Unemployment Claims, all lined up pre-market. This is sure to be a big day, so please be careful. There is also a lot of geopolitical talk with Iran as we come into the midterm elections, which is also sure to cause some volatility.
Volume: We have increased Relative Volume of approximately 15%. Using our relative calculation, that means we could move approximately 46.75 points above or below the overnight highs or lows today.
Range: Expected range of 74.5 points. We have currently moved 33.75 points, leaving us approximately 40.75 points left in the tank above or below the overnight highs or lows — closer to 46.75 points with relative volume factored in. Pay attention for extreme volatility today, as this is a post-FOMC day and we could see a massive move.
Gamma: We are still in Negative Gamma volatility, and we are using two calculations this morning. Our old gamma flip calculation puts the flip at 7840.00, which is right by massive resistance. Our current and new calculation puts it at 7795.00, which lines up perfectly with our massive Daily leg-end high at 7791.00 and the big Weekly bull/bear pivot at 7803.00. In my opinion, this is an excellent calculation and gives us a true ceiling to work with this morning — keep an eye on the gamma flip at 7795.00. Dealers are hedging to the downside, which can open up increased ranges and massive volatility.
Trend: Down. The Weekly, Daily, 4-Hour, and 1-Hour are all pointed to the downside, telling us that we remain bearish as long as we continue to stay below our significant pivots.
🧠 Current Market Context
The Failure to Gain at the Highs
ES finds itself in a serious situation this morning. We wicked the highs above 7803.00, taking out two highs and last week’s high, grabbed the liquidity, and played the Daily we called out at 7821.75. This was a huge Daily, and ultimately it made it so that we failed to gain on the Daily timeframe at yesterday’s close. After pushing up for well more than four days, buyers had an opportunity to close well above support and failed to do so. That means we still have some weakness in this market, and we are going to maintain our bearish stance for the time being. We have a very clear and very defined layout here of exactly where things shift and where everything goes wrong, and we have one beautiful level that we will be concentrated on today.
