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Good morning, everybody. Today is Wednesday, August 26th, and we come off another precision-playing trade plan day, as we had 7714.25 be the high of the day. As we know, this is a very significant Daily that we’ve called out multiple times, and it played to the tick yesterday, bringing us down all the way into the 7665 area. We once again were able to hold support at the lows as predicted in the trade plan, only to balance out yesterday once again inside our four-day balance that has held in a very tight, compressed range of 50 points.
Congratulations to all the trade plan subscribers who took advantage of this limited move yesterday, as it was a challenging day. But the trade plan played true as usual, providing multiple shorts and one long throughout the day. Many members in the inner circle were able to light up the scoreboard even with this minimal movement, so I salute all those who remained diligent and patient and waited for the proper setup.
Last night we stayed in a very tight 24-point range, essentially not moving anywhere outside of yesterday’s balance, staying extremely tight and compressed inside of yesterday’s cash session value area.
A Note on Today’s Market:
News: We actually have Red Tag news this morning pre-market. We have Core PCE Index month-over-month at 8:30, Preliminary GDP quarter-over-quarter at 8:30, as well as the Preliminary GDP Price Index. These are the first Red Tag news events we’ve had all week and they are sure to create a shake.
Volume: Relative Volume is at minus 19%, which could reduce our move today all the way down to 25.5 points above or below the overnight highs or lows. At the time of this writing it had slipped further to negative 21%. That leaves us a projected range that stays extremely tight and potentially still within this massive four — going on five — day balance.
Range: Expected range of 55 points. We have moved 24 points in the overnight session, leaving us approximately 32 points above or below the overnight highs or lows before the volume adjustment.
Gamma: We do, however, have a Negative Gamma regime still currently going on, with our gamma flip level all the way up at 7775. This means dealers are still hedging to the downside and hopefully will present expanded range volatility and offer trades in both directions today.
Trend: Downside lean. We are currently down on all time frames still, except for the Weekly, meaning we are pointed down on the Daily, 4-Hour, and 1-Hour. This leads us to believe we could still move lower and fill the gap all the way down to 7640, or even lower into our supports closer to the 7600 area.
🧠 Current Market Context
The Five-Day Coil & The Catalyst
We are sitting in a very tight four-day balance range area where we are stuck in a 50-point range, and we are being held extremely compressed. We need to be choosy about what we trade today, as this has been the epitome of summertime trading — extremely slow cash trading sessions, near to little movement in the overnight, and a real lack of Red Tag news, all while we sit very close to the all-time highs and geopolitical events seem minuscule at this point in time.
We have, however, been maintaining this balance at the lows for five days now. We have to assume that they are holding this for a reason and that anything is possible. This balance has been held up by the 7661.50 Daily and suppressed by the 7714.25 Daily, keeping us very tight and locked in.
Often we know that when we have these extremely tight ranges in the overnight session, we generally will get an oversized move during the day. Hopefully we will get that today with Red Tag news on the horizon. However, given that this is summertime trading and we have relative volume at negative 21% at the time of this writing, we have to be ready and able to take the trades as they come. Even with Red Tag news, we may only get one or two prime opportunities for a trade.
