S&P 500 Daily Trade Plan: Price Discovery Mode & The 7078.50 Globex High Target
A detailed ES & VIX plan for April 16th, breaking down the 7027.25 first support pivot, the 7078.50 Globex all-time high target, and the VIX 17.44 monthly defense.
SCHEDULED NEWS
OPTIONS VOLITILITY LEVELS
Morning everyone. Today is Thursday, April 16th, and we come off another awesome day in the trade plans as we balanced at the critical Daily at 7003.75 and the trade plan left us pointed higher looking for all-time highs above 7043.00 — which we nailed perfectly. We also spoke about the overhead resistance at 7022.75, which was our critical area to buy above. We were able to buy both the breakout and the retest, giving us a double-dip into support yesterday as we pushed higher into our highest Call Wall noted in the trade plan at 7061.00. Yesterday we finished the trade plan off strong, hitting all of our targets and completing our mission to conquer the markets just as planned. Congratulations to all those who took advantage of an incredible day yesterday — it was a low-volume grind up, but was extremely profitable and fruitful for those who were patient and let the process do its thing.
As we come into the morning, we are sitting at all-time highs, drifting sideways. We actually made a new all-time high in the overnight session at 7078.50, and for those of you who have been trading with me for some time, you understand the market mechanics — the cash session players will not leave this all-time high alone. This will be a target for the day and will more than likely get cleaned up today. Please keep this in mind.
A Note on Today’s Market:
News: No Red Tag news events today. However, we have Philly Fed Manufacturing Index at 8:30 AM and Unemployment Claims also at 8:30 AM. These are not Red Tag events but could give us a shake, so be aware pre-market.
Volume: Relative Volume is extremely low at -39.4%. This reduced relative volume shrinks our potential range, which is not a surprise as we sit at all-time highs in price discovery mode with positive gamma. Our effective range reduces to approximately 36 points above or below the overnight high or low.
Range: Expected range of 83 points. We have only moved 23 points in the overnight session, leaving approximately 60 points above or below the overnight high or low. With the relative volume reduction, that effective number is closer to 36 points.
Gamma: We remain in Positive Gamma territory. Our Gamma flip level sits at 6900.00, well below current price. Dealers are hedging to the upside and will defend this flip level with size if price approaches it.
Trend: Upside lean, clearly. We continue to diverge up on all timeframes — we have gained on the Daily and four-hour timeframes and are in price discovery mode traversing all-time highs. When we are trending to the upside on low relative volume, you do not fade this for a short. Generally speaking, on low relative volume you continue to grind with trend.
🧠 Current Market Context
Price Discovery Mode & The Globex High Target
We are sitting at all-time highs, drifting sideways. We actually made a new all-time high in the overnight session at 7078.50, and we can confirm that we are continuing to move higher with no defined upside targets. This is what we call price discovery mode — we simply use our options levels for upside targets as price continues to drift higher, finding what is deemed to be fair value. We have gained on the Daily and four-hour timeframes, and we have no structure to speak of overhead due to traversing all-time highs.
The insane push up over the past three weeks has left us with some serious market inefficiencies to the downside, as well as very limited and thin support below. However, this does not mean we can’t continue higher. We simply need to look for potential structure and sweep plays to confirm we are indeed headed in the correct direction. The Globex all-time high at 7078.50 will be a magnet for today — cash session players will look to clean this up. That does not mean that all all-time highs made in Globex need to be cleaned up the same day, but this will be an ongoing target until it is cleaned up.
