9/21 Daily Recap, Outlook, and Trading Plan

CME_MINI:ES1!   S&P 500 E-mini Futures

Yesterday's FOMC day was filled with volatility and traps, making it a challenging day for trading. ES finished below the support of the key triangle structure at 4470, indicating a bearish sentiment. Despite the volatility, smart trading strategies that focused on failed breakdowns and level-to-level profit management yielded lucrative results.

Market Gauge

🔴 Bearish

The Markets Overnight

🌏 Asia: Down
🌍 Europe: Down a lot
🌎 US Index Futures: Down a lot
🛢 Crude Oil: Up
💵 Dollar: Up
🧐 Yields: Up strongly
🔮 Crypto: Down

World News

  • US and global markets plunge on hawkish FOMC statement and dot plot, signalling higher rates for longer.
  • Bank of England and Swiss National Bank leave rates unchanged.

Key Structures

The large, multi-month triangle in yellow remains the primary pattern. Resistance is at 4550 now, with support at 4473. This pattern has driven trading all month and yesterday we lost support, indicating that bears are in control. A reclaim of this level would see ES push back to 4496, and likely clear it for a move back towards triangle resistance.

Support Levels

Key support levels for today include 4439-35 (Major), 4425-18 (major), 4407, 4400 (major), 4390, 4382-85 (major), 4377, and 4366 (major).

Resistance Levels

Resistance levels to watch out for today are 4448, 4460, 4465, 4473 (major), 4486-88, 4496, 4504 (major), 4514 (major), 4524, 4532, 4542(major), 4548 (major), 4556, 4562, 4566, 4574, 4580-85 (major), 4595-4600, and 4609 (major).

Trading Plan

The plan for today is to stay nimble and non-biased, taking level to level pieces and getting to the sidelines. The bearish sentiment means that bounces are likely to fade and supports to melt through. The most important level to track is 4473, which was yesterday’s breakdown point. If we get a relief bounce, the first touch of 4473 probably represents a good short.

Wrap Up

Post-FOMC trading is complex and requires a reactive approach. The general lean for today is a possible relief bounce to backtest the 4472 zone with 4439 and 4425 being possible spots. ES is likely to reject on that backtest. Always remember to protect your profits and trade smartly, even in volatile market conditions.

Disclosure: This is not financial advice and is for informational purposes only. Please consult a professional financial advisor before making any investment decisions


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