Has ES found the bottom yet today? 4600+ next?
Today is almost exactly opposite of yesterday, market trending lower until a few minutes before close, then AMZN huge beat almost instantly reversed all the loss for the past few hours. Also percentage wise, RTY is almost always higher than ES throughout the day, suggesting it does not buy this downward move. This plus the AMZN ER after close force me exit my puts around 4465~4470.
I mentioned my target of (B) wave was 4390~4445, and today is clearly short of that target, but given the previous fractals and RTY relative strength. I am of the opinion that this (B) wave (or whatever label it will change after the patter is more clear in a few days) is done, and we are going for 4640 range next, which could even further extended to 4680 (78.6% of the whole drop).
There are however a few alternatives:
1. Today's drop is only (a) of this (B) wave, and we will revisit today's range high around 4540~4550 as (b) of (B), then hit the ideal range of 4390~4445 in a few days.
or 2. That (b) of (B) will print a marginal higher high at 4600~4620 range and go back down to retest today's bottom, also in a few days.
For that reason, I plan to build calls (already got some as hedge at 4470~4480 range) tonight/tomorrow morning, but also got hedge puts at 4515 and will add new hedge puts around 4540, and if we do hit 4600, will hedge at that range too. In other words, I will maintain positive delta until proven wrong, but with puts at certain possible resistance levels.
I mentioned my target of (B) wave was 4390~4445, and today is clearly short of that target, but given the previous fractals and RTY relative strength. I am of the opinion that this (B) wave (or whatever label it will change after the patter is more clear in a few days) is done, and we are going for 4640 range next, which could even further extended to 4680 (78.6% of the whole drop).
There are however a few alternatives:
1. Today's drop is only (a) of this (B) wave, and we will revisit today's range high around 4540~4550 as (b) of (B), then hit the ideal range of 4390~4445 in a few days.
or 2. That (b) of (B) will print a marginal higher high at 4600~4620 range and go back down to retest today's bottom, also in a few days.
For that reason, I plan to build calls (already got some as hedge at 4470~4480 range) tonight/tomorrow morning, but also got hedge puts at 4515 and will add new hedge puts around 4540, and if we do hit 4600, will hedge at that range too. In other words, I will maintain positive delta until proven wrong, but with puts at certain possible resistance levels.
Comment:
Alright, I was wrong yesterday about market finding bottom already, let's see if it can find that bottom today, ES already made a lower low, so that fits the minimum requirement of (c) of (B), but ideally it will drop further down into 4390~4445 range today. The hedge puts entered yesterday aftermarket saved me, and I have already added some calls at the double bottom range, plan to add more if we can get further down.
Comment:
4445 hit, now waiting for bottoming pattern show up/confirm after open