Morning Session Highlights:
- Initial Price Reaction: The overnight market respected our critical “Line in the Sand” at 5755, triggering a Buy Response that hit our upside target zone of 5770-5775 with precision. This zone established early reference points for the trading day.
- CL and NQ Updates: Crude Oil (CL) initiated a successful short from the Open Range, achieving all target levels. Similarly, Nasdaq (NQ) triggered a short off the Open Range, setting the tone for early downside momentum.
Mid-Morning to Early Afternoon:
- Cycle Analysis: The Positive 3-Day Cycle continued to show strong reliability, tracking at a 93% accuracy rate. Key insight: A positive cycle is confirmed when the price remains above the Cycle Day 1 low during regular trading hours, independent of the closing value.
Afternoon Developments:
- Whiplash Setup: Following a stop hunt below the prior low, the market formed a potential Whiplash Structure, reclaiming the AM low at 5738 and providing a recovery back to the LIS at 5755. Big institutional players (“BIG BOYZ”) appeared to leverage this stop-hunt break for significant buying opportunities.
- Volatility Observations: The afternoon saw a notable volatility crush, with quiet price action settling around key levels. Despite a late-day MOC (Market-On-Close) sell imbalance of $1.6 billion, prices held steady at 5740, setting a pivotal reference point for the following day.
Strategic Closing Notes:
- PTGDavid emphasized the importance of not overtrading during choppy conditions, advising traders to remain patient and disciplined.
- For Tuesday, 5740 will serve as the critical level to monitor, with bulls needing to convert this zone into solid support to target further upside towards 5765-5770.
Stay tuned for further updates, and remember to trade your plan with precision and discipline.