Market Recap – PTGDavid’s Insights

The trading session began with U.S. Initial Jobless Claims coming in at 220K, slightly below the forecast of 225K, while PPI year-over-year was reported at 3.2%, just under the expected 3.3%. The market opened in a neutral state, lacking a clear directional bias, which PTGDavid noted could make trading challenging. He advised patience as the market sought resolution.

As the session progressed, he pointed out that market rhythms were shifting, likely to throw traders off balance. Barbara Lopez observed a potential “cup with a handle” pattern, and PTGDavid continued monitoring price action for confirmation.

Morning Session: Establishing Market Direction

Mid-morning, PTGDavid introduced the OODA Loop (Observe, Orient, Decide, Act) as a framework for making trading decisions. Around 10 AM, he noted that Cycle Day 1 expectations for a decline had been fulfilled, with price testing key levels. He highlighted short targets being met on NQ and CL trades and advised trailing stops to manage risk.

By late morning, he recognized a potential market reversal as the market began reclaiming key price levels. He shared a screenshot of a developing long setup on NQ, which played out as anticipated. Barbara Lopez mentioned that she had observed market reversals often occurring at this time, especially after indecision at the open. PTGDavid acknowledged her insight and continued tracking market movements.

Midday: Bulls vs. Bears Battle for Control

As midday approached, PTGDavid noted that bulls needed to reclaim key price levels to sustain any rally. However, he warned that every upward move was met with selling pressure. He described the market action as a “Wack-a-Mole Game”, where every pop got slammed down. Despite this, he anticipated that once enough shorts were accumulated, the market could stage a sharp rally.

Later, he reported that the market was searching for balance and stabilization after breaking the previous downtrend. He referenced a “Bud Fox Moment,” signaling a key decision point in price action. He also noted that Putin had reportedly agreed to stop fighting in Ukraine, with conditions for long-standing peace, though traders responded with skepticism.

Afternoon Session: The Battle for Key Levels Continues

By the afternoon, the market staged a “Shake n Bake” move around 2 PM, leading to a bounce. However, PTGDavid emphasized that bulls needed to clear and convert key resistance levels into support to gain real traction. A significant reversal, which he called a “YUGE Money Box Reversal,” took place, but gains remained uncertain.

As the session neared its close, he observed that failing to hold key zones would be a setback for the bulls. He mentioned that closing back within the prior range would be a victory for buyers. By the end of the day, PTGDavid reported that the Market on Close (MOC) was flat, questioning whether a rally could emerge in the final minutes.

The session wrapped up with mixed sentiment—while the market attempted to recover, bulls had yet to establish full control. Subhash thanked PTGDavid for his insights, marking the end of another dynamic trading day.

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Educational Takeaways from Today’s Session

1. Neutral Openings Can Be Tricky

   • When the market opens without clear directional bias, traders should stay patient and wait for a resolution. Rushing into trades can lead to unnecessary losses.

2. Market Patterns and Psychological Moves

   • Recognizing patterns like the “cup with a handle” can provide valuable insight into potential breakouts.
   • “Wack-a-Mole” behavior (constant rejections of rallies) can signal institutional selling before a larger move.

3. The Importance of Key Levels

   • Support and resistance levels play a crucial role in market direction.
   • When bulls reclaim lost territory, it can indicate momentum shifting in their favor.

4. Applying the OODA Loop for Trading Decisions

   • Observe market conditions.
   • Orient by understanding key levels and sentiment.
   • Decide on a trading plan based on evidence.
   • Act with discipline and risk management.

5. Cycles and Reversals

   • Understanding market cycles helps traders anticipate possible moves.
   • Observing time-based reversals (like the 10:30 AM reversal noted by Barbara Lopez) can give traders an edge.

6. Patience and Adaptability

   • Markets often shift in unexpected ways.
   • Staying flexible and adapting to price action is key to long-term success.

Today’s session highlighted the importance of discipline, patience, and key market structure analysis in making informed trading decisions.