SCHEDULED NEWS
OPTIONS VOLITILITY LEVELS
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Good morning, everyone. Today is Friday, September 25th, and yesterday was an incredible day in the trade plan. Even after two massive sell-offs — the big sell-off on Wednesday and an overnight push down on Thursday — we remained bullish based on our process, while knowing we could catch rotations in both directions. And indeed, the plan played out as expected. In the morning we caught the short from the significant momentum pivot named in the trade plan title at 7753.50 and rode it down for a total of over 35 points — only to have our bullish thesis stay intact and the market rally in the afternoon, completing our trade plan.
Subscribers, take note: the 7737.75 Daily and the 7753.50 Daily pivots are extremely important for monitoring momentum, and they proved true once again. Congratulations to all those who took advantage of this incredible price action. We have been extremely patient, and we were rewarded handsomely.
As we come into the day, we are actually up 27 points at the time of this writing, as price continues to drift higher based on our upside lean, just as predicted.
A Note on Today’s Market:
News: No Red Tag news to speak of. We do have Consumer Sentiment revisions and Inflation Expectations at 10:00 a.m., which is 30 minutes after the open. This is not a Red Tag event, but given its timing, set your clocks so you are aware of the volatility that could ensue.
Volume: Relative Volume is negative 10% this morning, meaning we could possibly reduce our expected range to approximately 23 points above or below the overnight highs or lows.
Range: Expected range of 78 points. We have currently moved 52.25 points, leaving approximately 26 points in the tank above or below the overnight highs or lows before the volume adjustment.
Gamma: We had an interesting options event this morning, as the gamma flip level moved all the way up to 7890 — deeper into all-time high territory. Dealers are still hedging to the downside, and this Negative Gamma regime provides not only volatility but an indication that rotations will be quite possible and extremely relevant for our market context. Money can potentially be made in both directions today.
Trend: We are still up on all time frames. On Monday we had an insane rally with no pullbacks into all-time high territory, on Tuesday we popped an all-time high once again only to grab some liquidity, we sold off massively on Wednesday, and we drifted lower in Thursday’s overnight session only to push higher. This is simply profit taking at all-time highs, and we are continuing to look for more upside.
🧠 Current Market Context
Profit Taking at the Highs, Not a Trend Change
We have some serious upside resistance above us as we continue to move higher, but VIX is getting a massive move lower, as it found resistance at the 16.20 / 16.39 area we’ve called out for weeks. Once again that level proved true, sending VIX down early this morning and sending the indices right back up into our massive 7800 Weekly momentum shift pivot.
The 7800 will be true once again today. This is without a doubt one of our most important spots to pay attention to. Being above it is inherently bullish. Being below it is not necessarily bearish, but momentum certainly stays to the downside and we could be looking for rotations underneath it. Just like yesterday, we will be looking for longs today, and they have set up quite a bit of support for us to play.
