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Morning everyone. Today is Tuesday, October 20th, and we come off another insane day in the trade plan. We talked about 7770 being our line in the sand, and after our fantastic short from Friday, we got a massive squeeze. On Sunday, price squeezed open and took us directly into the 7770 area, reacted in the overnight session, fell back to our significant Daily, and popped once again — only to smack off our Weekly at 7772.75. This was the massive Weekly we talked about not only in the weekend review, but labeled clearly in the trade plan as the major level to watch for a huge smack, and we got it yesterday in spades. Congratulations to all those who took advantage.
This morning we are still coming down off of that smack, down 20 points at the time of this writing and leading us lower — just like we predicted in the weekend review and in yesterday’s post-market breakdown, where I was extremely vocal about us coming down to at least 7644.50 and potentially lower.
A Note on Today’s Market:
News: No Red Tag news to speak of, and there is no news on the horizon whatsoever. Today’s move will be created simply by price action and the inability to hold support.
Volume: Relative Volume is elevated at +23%. Using our relative calculation, we could move approximately 59.25 points above or below today’s overnight highs or lows — a very real possibility given the negative gamma environment.
Range: Expected range of 87.25 points off our GEX levels. We have only moved 39 points so far, leaving approximately 48.25 points left in today’s session — and with relative volume factored in, roughly 59.25 points in the tank.
Gamma: We are in Negative Gamma territory. Dealers have shifted clearly above us, and with the gamma flip level moving all the way up to 7850.00, we will be in negative gamma for quite some time. We are also heavily skewed to the put side — this is the play and the trade, and we can clearly see it inside the options themselves. Remember: the move downs are usually more fierce and swift than the move ups, so be very careful about where you initiate buys.
Trend: Down on all timeframes. The Weekly flipped down on Friday, and we are down on the Daily, 4-Hour, and 1-Hour. Our process is pointing us much lower and has given us no reason to look for support until we at least make new lows.
🧠 Current Market Context
Weekly Progression Down & The 7772.75 Precision Smack
Yesterday we got a beautiful touch at the 7772.75 Weekly, which is currently sending us lower. As we saw on Friday, the Weekly touch at 7803.00 was a monster hit that sent us down well over 130 points. Once again, we got a beautiful precision play off the next Weekly at 7772.75 — in my opinion, this is weekly progression down, and it could really send us soaring to the lows. With that said, we are obviously looking for downside moves today. I have no buys on the map at the time of this writing. Our main target is new lows beneath last Friday’s low, looking for the 7673.50 Weekly as our monster target for the day. Located down there, we also have a significant value area and a massive Put Wall that we need to pay attention to after sweeping those lows.
