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Good morning, everyone. Today is Wednesday, October 7th, and we come off another crazy day in the trade plan. We talked about the Daily at 7837 and the gamma flip level at 7830 providing our massive support, and as long as they held, they would propel us into all-time high price discovery mode. That is exactly what happened: we opened well above the previous all-time high, and price continued to push upward before basing sideways through the remainder of the afternoon. Congratulations to all those who jumped on this magnificent long, even though it was a hard trade to get on. Team Vici knew where we were headed — all-time high price discovery, taking profits into our massive Call Walls.
As we come into the morning, the indices are down 31 points at the time of this writing, as distribution from the overnight move sent price lower. That has sent VIX screaming off the 14.87 Daily leg we talked about — our big target on VIX yesterday — which has proven true, with VIX up well over 6% in the overnight session. That move brought the indices right down into our first major area of support at 7837.
A Note on Today’s Market:
News: No Red Tag news pre-market. This afternoon we have President Trump speaking at 1:00 p.m. and the FOMC Meeting Minutes at 2:00 p.m. We already know what happened with the FOMC this month, so the minutes should not provide much volatility, but be aware of the release time in case the algos want to shake. Both events are enough to give the markets some gyrations, so be prepared for anything.
Volume: Relative Volume is positive 4%, meaning we are relatively flat on the day and should be able to expect our full range.
Range: Expected range of 75.75 points. We have moved a total of 49 points, leaving 26.75 points in the tank above or below the overnight highs or lows.
Gamma: The gamma flip level is located at 7830, meaning we are still in Positive Gamma, and dealers are hedging to the upside as they assume we will get more upside this morning. Options levels are very limited this morning, but the lower Put levels are strategically placed at our significant Daily levels. We have also just touched the second standard deviation options volatility level at the low, which gives us a 90% chance of not closing above the opposing options volatility level. I highly suggest you find where that level is, as it could set certain expectations for the day.
Trend: Up on all time frames — the Weekly, Daily, 4-Hour, and 1-Hour. Technically speaking, we are still very much pointed to the upside.
🧠 Current Market Context
Standard Auction: New Highs, Profit Taking, Pullback to Support
ES was in massive price discovery mode yesterday. Just like SPX, it pulled a massive gap-and-go after holding the big 7837 Daily in the overnight session, which sent it much higher. In the overnight session we’ve fallen back directly into this area of support and have already tested the 7837 Daily. It played beautifully this morning and provided a very nice reaction — but the indices are still feeling suppression as VIX continues to climb.
This is not abnormal. We have seen it many times as ES and SPX push into all-time highs: individuals are given an opportunity to run, profits are taken, and price pulls back into support. Generally speaking, this is fairly standard market auction action. Please remember that we are still up on all time frames on ES, and we have no reason to be bearish. We will be looking for longs today as long as we stay above our significant areas.
