4/14 Trade Plan
Hello and welcome to another installment of my daily e-mini trade plan. For any new readers, welcome! In this newsletter I discuss levels, scenarios and market analysis for the S&P500 market.
Hello all, we saw a very nice session for the bulls with both indexes climbing back to CPI day highs!
Now the plan shared last night called for a bullish reversal targeting 4156 if ES bid above 4130 and NQ above 13050.
This turned out to be a great call. Personally I lost money trying to short NQ this morning lol.
Right before the open I sent out a message:
At the open NQ went vertical trading up above 13050 in the first two minutes. ES on the other hand was range bound not budging. My thought was that the broader market (ES) had already pulled off it’s pre-market highs and was stagnating and this NQ breakout was a bull trap.
I bought puts on NQ on that long green candle at 8:38, after several attempts sellers failed to take back 13050 and once ES broke over its a period range (first 30 minutes) the breakout was on (and I, stopped out).
From here it was a textbook trend day with some pretty strong legs once we broke above that 4156 level I shared last night.
We finished the day hitting and exceeding all upside targets and settled the day 4170/13200. Anyway, I got in my own way today trying to go against my plan. I try not to be too hard on myself in this game, there will be another trade tomorrow.
If we zoom out and look at the longer time frame, on ES we are back at the top of the distribution range from February.
And on NQ we are well above these highs and coming up on the August 2022 highs.
Longer term this market has not moved. We are trading back at the same levels we saw in summer of 2022 when inflation was 7,8,9%. Has the macro outlook changed since then? I don’t think so. Look tech is leading the way higher while interest rates are at 5%. Just look at NVDA trading at 44x forward earnings (150x earnings!). Bitcoin has doubled since march! Unless you believe the FED is going to start cutting rates this summer, I don’t think the risk reward is good for longs here at 4200/13200.
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