Last week saw major liquidation with late longs going into FOMC. Thursday was an inside day followed by weakness in the overnight session going to into PCE Friday morning.

Going into this week will use Friday’s range as a guide.   Friday’s low during RTH 5898.50 as the halfback of the PCE data release candle, Election Day RTH low and November VAL, including the after hours wick on FOMC. Friday’s high is at a LVN from last week and #2 and #3 single prints that were formed from the FOMC sell.

If we trade lower first, focus should be placed 5966, and 5945-5931. 5966 as last week’s VAL and 45-31 as Thursday’s Spike Down. Buyers will want to defend this or risk Friday’s low. A look below and fail of the spike bottom 5931.75 and Friday’s low should be considered for new longs.

Further weakness will see London’s low from Friday morning followed by the election gap fill at 5813.25. This would also align with Friday’s range 50% extension. If we trade down here, buyers most likely will appear at or near the gap fill. So shorts should be mostly covered by then.

If we trade higher first, buyer will need to build support above Friday’s high and target the single prints above 6091.50-6118.50. 6079.25 is the FOMC event candle low. Acceptance above opens FOMC high at 6137.25. Further acceptance opens 6186 – the back-adjusted ATH. 

I would be cautious of a look above and fail of Friday’s high triggering shorts. If so, shorts will need back below 6000 and 5982 to pick up steam.

FOMC Vwap: 5981.25
FOMC Event Candle: 6079.25-6137.25
Spike 12/19 – Base: 5945.5, bottom: 5931.75

Weekly Expected Move: 90pts – 5907 / 6086
Dec 23 Expected Move: 47pts – 5949 / 6044

Expected moves are based on what the options market has priced in as implied risk for that period. There is a 68% chance price remains within that range by the following close. If price moves outside the range, it is common to revert and close back within.

We continue OTFU on the weekly and daily. I want to be slightly cautious above here, not because it’s bearish, but simply because we’re above a 2 sigma deviation (SPX 6073) of the YTD vwap (SPX 5405). In the past, price has whipsawed at this deviation up to the 2.5. While I remain long, I also must have one foot out the door.

Last week created a double distribution profile with Friday ending in the upper part. Thursday saw a pretty large seller come on around 6106 which then saw some resistance on Friday. Friday’s initial move at the open from the NFP data left a poor high. This will most likely be revisited. Main concern for buyers here would be an excess move above Friday’s high creating a look above and fail. I would watch 6114-6119 for exact scenario.

For longs, I would be interested in a look below and fail of 6092-88. There is a LVN between Friday’s low and the 12/5 Spike base. Take this up to 6100-06, trim and see where we go from there. A break above Friday’s VAH, 6104 would target Friday’s Poor High. Afterwards, we observe for the look above and fail possibility. Otherwise, trail the long. Above then targets 6124 and 6136, Friday 50% and 100% extensions respectively.

If we trade and get traction below Friday’s low, the NFP event candle low would be first target at 6075. Further weakness may finally see the gap fill at 6066 where I do expect buyers to pop in. Further weakness, would then target Nov RTH ATH 6060 and old balance top at 6045.

In the end, buyers really are not in serious trouble until back below 6k.

Weekly Expected Move: 61 – 6038 / 6160
12/9 Daily Expected Move: 20 – 6079 / 6119

Massive move last week. Regardless of the election outcome, seasonality wise, long for the election has been the plan. Now, the dust will be begin the settle and will be looking out for new balance to form. Until Daily OTFU (one-time framing up) ends, trend up is your friend. 

Buyers really have nothing to worry about until 5900 is lost. This is the Election Day low. I would expect defense of the 7 day balance top, 5925 to be defended at least a few times. At the moment, that’s 100+ pts lower. 

For this week, I will use Friday’s range (6004.5-6040.5) as a guide, including the FOMC range (5985.5-6007) which happened on Thursday. Friday’s low, represents FOMC high, Friday EU highs and just below Thursday’s Value Gap (6001.50). This will be the first area for buyers to attempt. Weakness doesn’t really begin to take shape until below FOMC’s low at 5985.50 which I do expect to be a buyable spot with a look below and fail trade. If sellers gain momentum here, then the gap fill at 5967 becomes a magnet. The entire 5967-5977 range I would look for additional buyers to begin to show up. I believe a supported buy here at or above the gap fill and a reclaim of the FOMC low would be very bullish.

If we continue higher, we have Friday 50% extension 6058, 7 day balance 200% extension 6070-85, and weekly expected high at 6093. Weekly extremes isn’t until 6125-6140.

• Weekly EM: 70pts – 5953 / 6093
• 11/11 Daily EM: 25pts – 5998 / 6048
• Friday Extns: 5968.75, 5989.75, 6058.5, 6076.75
• FOMC Range: 5985.5-6007
• Election Range: 5901-5967
• Spike 11/6: 5964-6967
• Value Gaps: 6001, 5943,
• Gap: 5967
• Single Print: 5943-5945.5
• Last WK Distributions: Upper: 6975.25-6041.25, Middle: 5900.25-5965.75
• Lower: 5724.5-5822.25

Generally, any selling should be considered profit taking and not necessarily a “top” until we break previous day lows and confirm lower and form lower highs. With that said, be on your toes. No over trading.

We continue to move higher where false breakouts and breakdowns happened daily generally with a Spike at the end of session. As we continue to consolidate after expansion, we must continue to engage at the edges.

We now have a new 5 day balance (5850-5925). The lower end marking the Oct 15 spike, breakout of previous consolidation and sits just above Oct 7 week VAH, Single Print (SP) (5840-5845), and previous highs. Breaking below this area will open potential value rotation back to our 2 week balance top ~5798.

Friday left us with an inside day (5886.5-5915.25) and will be used as our guide for this week. Friday’s top lines up with the Oct 14 Spike base, Retail/Jobless event candle, and last week VAH (5914). Friday’s low marks Oct 17 Spike base, 5 day balance halfback, and Single Print (5881.5-5884.75).

Buyers will need to move above Friday’s high to test balance top. They then must continue higher or risk a failed breakout. For that, The bull pivot is 5925-5935. Acceptance above opens Friday 100% extension 5994 and 5day balance 50% extension 5962. Further acceptance will move into 2wk Balance extremes (150% extensions) which includes the weekly expected high at 5970. Extended target will be the 5day Balance 100% at 6001.

Weakness will begin to show below Friday’s low 5886.5 and last week’s VAL 5879. This will be buyers first area to show up. Further weakness will move us down to October 17 OVN low marking an RTH value gap and Wed (10/16) IBH (Initial Balance High). There is a naked POC at 5868 that may be reactive.

Sellers will pick up steam below the bear pivot 5841-5850; however, I do expect buyers to attempt a rescue here at 5day balance bottom as the weekly expected low is just below at 5846. A look below and fail on last Wed/Tues lows is worth a long. Acceptance below may unravel price down to 2 week balance top at 5797.

We buy until we die. – Me so tired…

Last week, the main goal for buyers was to remain above 2 week balance low – 5720’s-30’s mostly in part to protect the FOMC range. Monday evening’s liquidation move did just that and gave enough steam to reverse Monday’s move back to balance top. On Friday, we had a strong move higher breaking above the 10/9 spike.

For this week, will use Friday’s range as our guide ending the week with a P profile. Friday’s high marks a poor high which will need to be cleaned up. If accepted, buyers can see a move towards 5890 for a 50% extension of range. On the other hand, Friday’s low marks PPI’s low and lower range of CPI including Thursday’s VAL. Failing to hold Friday’s low, can see Thursday’s inside day low followed by the single prints at 5808.

Will continue to observe the 10/9 Spike (5840-5846.5) as this includes a remaining single print (5839.75-5845) from Friday. Also serves as the midpoint on Friday’s range along with last Wednesday and Thursday highs.

Buyers need to sustain above 2 week balance – 5797.75. Acceptance above Friday’s high can see 5872 (CPI 100%) followed by Friday 50% and 100% extensions 5891 and 5913 respectively.

Weakness will begin to show below Thursday’s IBH 5834 which also marks PPI’s event candle high. The daily expected low is 5822 and lines up roughly with Friday’s low. Failure to hold here and selling can increase back towards 2 week balance top 5797.75. Failure to hold will rotate to the other side.

Until a previous day low is breached and opens the following day lower with acceptance, shorts may continue to be pre-mature. With that said, I am mindful of the potential near term “top” with seasonality or buyer exhaustion perhaps setting in.

I see a lot of traders “chase” in the middle, and “fear” at the edges. I say chase at the edges and “fear” in the middle. I am certain you’ll see good results.

Weekly Expected: 5764 / 5942
10/14 Expected: 5822 / 5884

I remain bullish but cautious as from last 2 weeks, new sellers, and to some accounts big sellers, have entered the picture and have stuffed price nearly every day at NY open. There are three excess highs that are bearish until cleaned up. This is on 9/26, 9/27, and 9/30 – along with a potential 4th excess from 10/4. There is still an open large spike from 9/30 after Quarter end window dressing and now a spike from this past Friday into now 2 week balance top. Bulls have been lacking breakout momentum and sellers failed, what would have been perfect sell last week.

Near-term picture is about last week’s low and 2 week balance bottom. At the moment, FOMC range continues to be protected with the high being 5756 and balance bottom 5733. This is a line in the sand for bulls. They must continue to protect the FOMC range (5756-5673) and especially the 5730-20 area which may hold another hit, but has been tested to death.

Buyers will seek acceptance above Friday’s spike (base: 5797.5, top: 5804.75), followed by acceptance of the 9/30 spike (base: 5799, top: 5820.25). At this point buyers need to clean up the three excess highs with 9/26’s marking the 50% balance extension, 50% Friday range extension, and 9/26 ETH ATH. A break above can see 5850-60.

Weakness can show below Friday’s spike base but more so below 5783-5776. This range holds PCE/Inside day low, 2 week balance POC, last weeks VAH and the halfback of NFP event candle. A break lower can see Friday’s low tested which sellers would need to press. If accepted lower, 2 week balance bottom and last week’s VAL will come into question. At this point buyers must show up yet again or a break lower can finally see the value gap filled at 5710 and perhaps down to 5700 NVPOC. Further weakness may see FOMC lows and Spike down from 9/18.

Weekly Expected Range: 5705 / 5885
Events: 10/9 – FOMC Minutes, 10/10 – CPI, Jobless, 10/11 – PPI/Michigan Sentiment. All week we have Fed speakers

Are things changing under the hood and is seasonality still around?

Last week we saw just about every day US sells the open and reverses late afternoon. EU would end up doing the same except for the drastic no selling allowed Wednesday night session. This pattern repeated with buyers showing up at the most perfect trend line since Friday’s (9/20) low. Did all this change this past Friday? So far this looks like a failed breakout of balance. So caution is warranted.

I do generally believe we can reach higher still but will remain cautiously bullish as we enter October. A tad bit longer view is the bulls don’t have to worry until we break FOMC’s low.

For this week, focus will be on Friday’s inside day. Thursday’s attempt at a breakout did fizzle but may not be completely out of the picture. ATH was made during overnight hours and will need to be tested. With that said, a breakdown of Friday and Thursday’s low will single a potential change and may bring out more sellers.

5781.75 needs to hold on Monday’s RTH session, perhaps with a look below and fail. If so, then look towards the balance top and apply balance rules. On the shared chart, you’ll see this past week was spent in an upper distribution area where a Low Value Node (LVN) can be seen at our balance bottom If weakness does occur, I would expect buyers to be ready down there. This is roughly 5750-5730.

Buyers will need to reclaim balance top, 5797 and 5804. Reclaiming these levels will give more confidence to longs and can open both Friday and Thursday highs, 5821 and 5830 respectively.

Put an anchored VWAP from FOMC (9/18) cash session open. This should land around 5770. Last week’s VAL also sits there. So keep an eye on it.

If we look below Friday’s low and reclaim 5790 or so, then that’s a long. Same would be true for Thursday’s low and reclaiming Friday’s close.

• Aug 23 / Inside Day Range: 5603-5662
• 2 Week Balance: 5574-5669
• Weekly Expected Move: Low 5587 / High 5727
• Prior Week Value: VAL 5608 / POC 5638 / VAH 5646
• Spike 8/30 Top: 5665
• Spike 8/30 Base: 5646

5613, 5627, 5638, and 5649 still to be observed. We had two data prints around the 5630 area, GDP and PCE.

Will use Friday’s range for the coming week as the low and high both roughly align with the previous Friday’s inside day range. Friday ended with a spike up. Will apply Spike Rules on Tuesday’s RTH. Buyers will want to confirm by moving price above the Spike top and breaking out of balance. Accepting below 5646 may signal a failed attempt by buyers again. Reminder on high timeframes, sellers are up here. We also must still apply Balance Rules.

A pullback into the balance halfback 5621, Friday’s VAH 5640, and last week’s POC 5638 may be buyable with a reclaim of a main pivot level. Last opportunity for buyers will be Friday’s POC 5616 and VAL 5608.

Friday also left an excess at the lows, which may need to be cleaned up including a test of Wed OVN low below balance.

Breaking above 2 week balance targets the 5690 gap fill, 5710’s 7/16 Spike & Balance extension 50%. However, breaking below balance targets Friday’s -50% extension and Aug 16 low with further weakness going to the single print at 5522

Continue to be cautious as we near balance top where high time frame sellers remain including balance bottom with buyers. I would not long the top or short the bottom. If a supported breakout occurs then you can join. We are consolidating now for 2 weeks. Consolidation leads to expansion. Don’t fight it when it confirms.