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Good Thursday morning!
Nothing but bright, sunny skies ahead for the bulls!!! As expected yesterday, the FOMC (Federal Open Market Committee) left rates unchanged and the markets absolutely loved it! The never ending bull market continues and with zero fear and nothing to worry about on the horizon, new all time highs were notched without the slightest problem or issue!
Just as we had the previous day, there was a big spike higher leaving another set of single prints and thin, poor structure below. As a quick recap from yesterday....
"Single prints occur when traders either buy or sell the markets very quickly and very little time and volume trades in those areas. When that happens, if price stays above (or below) the single prints, it shows a strong commitment of who is in control! And right now the bulls are still very much in control!"
I can basically parrot the same thing this morning! Now when I say "thin, poor structure" what I mean is (as an example)...there is a house of cards being built on top of another house of cards, on top of another house of cards!!! I have been saying this for a while now...it is nothing we should be fighting, and there is no way to know exactly when we will be able to call a top, but this will not end well!!! Mark my words.
As the profile picture below shows, the most amount of time spent and where value built, was much lower in the day and the market is now VERY STRETCHED to the upside. After the FED announcement, buyers took it higher very quickly and you can see where the "structural deficiencies" lay in the chart! Now I am not saying this will break lower today necessarily to repair this structure, but keep these levels in mind going forward.
Futures are higher again this morning and price is gapping above prior days range. Overnight inventory is 100% net long so there is a good chance that the market will fade lower to balance out this very skewed net long inventory. First target is prior days high at 5295.75 then settlement at 5286.75, then possibly the 5270 area. If, however, the bulls keep prices above prior days high, then the bears have zero chance. The next potential short may be above at the 5335 area. Staying above the prior day high and the "Key Zone" listed below is a bullish confirmation signal.
VPOC update: NEW RECORD......We now have 21 untested points of control still below current price! 5230 was added below yesterday!! Wow!
TARGETS AND KEY LEVELS TO WATCH:
/ES upside target is: 5330 - 5335
Key Levels: 5295 Prior High & Overnight low
downside target is: 5255 - 5250
/NQ upside target is: 18,605 - 18,655
Key Levels: 18,540 - 18,530 Prior high & Overnight low
downside target is : 18,375 - 18,360
/RTY upside target is: 2105 - 2110
downside target is: 2090 - 2085
Economic Data: Busy Day!!
Jobless Claims @ 8:30 AM EST
Philly Fed Manufacturing Index @ 8:30 AM EST
Philly Fed Manufacturing Index @ 8:30 AM EST
PMI Composite Flash @ 9:45 AM EST
Existing Home Sales @ 10:00 AM EST
Leading Indicators @ 10:00 AM EST
Natural Gas Inventories @ 10:30 AM EST
More Color.......
/ES - Key area of Demand at $5225 - 5250 then below that at $5155-80
- Watching the first hour to see if price can hold above $5219 to play long
- I only want to play short if price can hold below $5180 after strong sell off
SPY - Key Demand $505-504 then at $514-516 with HOD supply at $523
- First set up I’m watching is a break and retest from $518 to play long. Next would be a bounce from key demand to play long after a pullback and hold above $514
- Hard for me to play short unless there is strong selling below $514
SPX - Key Demand at $5130 - 40 then at $5160-70 with HOD at $5226
- Looking to play long as price can hold above $5165 to play long $5159
- I would only be interested in playing short if price can break below $5120
/NQ - Key Demand $18210- 18230 then at $18010- 50
- I would only like to play short if price can break and retest below $18200
QQQ - Key Demand at $432-434 then at $437- 439
- Only interested in off break and retesting from key demand playing long
- If price can break and hold below $435 I would look short targeting demand
As ALWAYS, have your stops in place!!!
Have a great day!
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