Market Recap – February 11, 2025

Morning Session:
The trading day began with a bearish tone as PTGDavid outlined key downside scenarios for both ES and NQ. Early market action saw a retest of the Sunday GBX breakout zone (6058-6060) with a key level at 6075 acting as a pivot. Bearish targets of 6060-6055 were initially in play, aligning with the premarket analysis.

As the session progressed, price action tested and confirmed these levels, fulfilling downside targets before a shift in sentiment occurred. A pivotal moment came with Federal Reserve Chair Jerome Powell’s testimony at 10:00 AM, which was met with a positive market reaction. This led to an upside breakout from the 65-75 range, triggering a bullish resolution and an eventual gap fill.

Midday & Afternoon Session:
After completing the upside gap fill, price action oscillated around 6075, reinforcing its significance as the “Line in the Sand” for the day. Market volume remained relatively light, with traders positioning ahead of the upcoming CPI release. A holding pattern developed, reflecting indecision as traders awaited fresh data.

Later in the session, PTGDavid noted a shift, with a bullish scenario targeting 6095-6105. The 6095 target was reached, but further upside momentum stalled. The session closed with a neutral stance, as price remained within the defined range, failing to establish a decisive breakout.

Key Takeaways & Educational Insights:

1. Understanding Key Price Levels: PTGDavid consistently emphasized the importance of 6075 as a pivotal level. Identifying and respecting these levels allows traders to anticipate market reactions with precision.
2. Market Reaction to News Events: Powell’s testimony sparked a notable shift in sentiment, demonstrating the impact fundamental catalysts can have on price action. Staying informed on scheduled events can provide valuable trading opportunities.
3. Gap Trading Strategies: The successful execution of a gap fill trade reinforced a common market tendency—when price exceeds the opening range high, a move toward gap closure becomes a high-probability setup.
4. Patience & Discipline: Later in the day, PTGDavid highlighted the importance of waiting for high-quality setups, avoiding unnecessary trades during a holding pattern. This is a crucial habit for long-term trading success.

As traders prepare for tomorrow’s CPI release, the focus will be on how inflation data influences market direction. PTGDavid will be back in the morning to provide insights into the evolving landscape.