Market Overview
Today’s trading session was largely influenced by key technical levels, algorithmic activity, and the Federal Reserve’s monetary policy announcement. PTGDavid provided structured scenarios for both bullish and bearish movements, emphasizing price action around the 6090 level.
- Bullish Scenario: Sustained bids above 6090 targeted the 6105-6115 zone.
- Bearish Scenario: Offers below 6090 initially aimed for 6075-6065, which was successfully reached later in the session.
Pre-FED Market Behavior
The market showed signs of indecision early in the session, with traders waiting for the Federal Reserve’s policy statement. Key developments included:
- Early trading: Market showed responsiveness to prior day’s value areas, with price action testing key levels.
- Algos & liquidity sweeps: Notable liquidity grabs were observed, particularly in the Nasdaq (NQ) and S&P 500 (ES).
- Price consolidation: PTGDavid noted a “chop zone,” signaling limited trading opportunities due to a lack of directional clarity.
Federal Reserve Announcement & Market Reaction
At 2:00 PM ET, the Federal Reserve left interest rates unchanged, removing prior references to inflation making progress. This triggered repricing in the market:
- Initial reaction: Sharp movement as traders reassessed expectations for rate cuts.
- Projection targets hit: PTGDavid noted that predefined decline projections were fulfilled, reinforcing the importance of technical levels.
- Buy response from key decline areas: Post-FED volatility provided opportunities for nimble traders, but overall market sentiment remained cautious.
Closing Market Sentiment
- The market remained volatile, closing within the mid-VWAP zone.
- The imbalance at market-on-close (MOC) was relatively small at $800M, indicating no extreme positioning.
- Post-close earnings from MSFT and TSLA contributed to additional selling pressure.
Educational Takeaway
1. Have a Game Plan: PTGDavid’s structured bull/bear scenarios highlight the importance of defining potential price paths before the market opens. Traders should always establish key price levels and trade accordingly.
2. Stay Adaptable on Major News Days: FED Days introduce uncertainty, requiring traders to be flexible and avoid strong biases. As PTGDavid emphasized, “Love ’em or Leave ’em”—be prepared to exit positions quickly.
3. Price Action Confirms Bias: Throughout the session, predefined targets (such as 6075-6065) were met, reinforcing that disciplined trading around key levels increases consistency.
4. Market Memory Matters: Buyers and sellers often react to prior price action, making areas like prior POCs (Point of Control) and VWAP zones crucial for trade decisions.
5. Capital Preservation is Key: On high-volatility days, maintaining discipline is critical. PTGDavid’s approach of prioritizing capital preservation is a reminder that survival in trading is just as important as profit-making.
Final Thoughts
Today’s session was a testament to how markets respond to both technical levels and macroeconomic events. While volatility provided opportunities, it also required traders to be tactical and risk-aware. Staying disciplined, respecting price action, and adjusting to market conditions are the hallmarks of professional trading.