Trading Room Summary for October 2, 2024

Today’s session began with a retest of the prior low at 5733, which initially triggered a rebound as buyers stepped in, pushing price back to the 5750 zone. The Line in the Sand (LIS) at 5760 became the focal point for both sides, with bulls needing to clear and convert this level to sustain a potential “relief rally.” Early market alignment favored the short side, with lower targets outlined between 5719 and 5714.

A failed dip below the prior low at 5733 led to a trade opportunity commonly referred to as Look Below and Fail. PTG has coined this as the “Whiplash Trade” with price recovering and providing a buy signal. By mid-morning, price had rallied back to the LIS at 5760, though a test of the overnight high was rejected, leaving price range-bound.

The initial 3-Day Cycle target at 5767 was fulfilled during the AM session, though buyers struggled to gain ground beyond the 5770 resistance, marking the top edge of the prior RTH Value Area. Subsequent price action remained listless, with bulls unable to break the overhead resistance, and price oscillating around the VWAP zone.

In the afternoon, market activity was muted, though there was a brief spike in buying interest as a $1.1B MOC Buy Imbalance emerged. Despite this, the session concluded uneventfully, with price settling around the LIS at 5760. Today’s value area was contained within the prior session’s value, suggesting a balanced day with little directional conviction.

Key Levels:

• Line in the Sand (LIS): 5760
• Resistance: 5770
• Support: 5733 (prior low)
• Lower Targets: 5719 – 5714

Looking forward, traders are advised to monitor potential volatility on Thursday, as the market may be primed for a more significant directional move following today’s consolidation.