SPX500 and NAS100: Market Context Analysis

Jan 29

📊 SPX500 Analysis

━━━━━━━━━━━━━━━━━━━━━━

Price is interacting with liquidity within the inefficiency zone, which suggests that large players are accumulating long positions in these areas (blue rectangles). However, price struggles to hold above.
Note how price engages with buy-side liquidity at the highs (marked with purple lines) without any strong acceptance. In essence, the objective of these local bullish moves is liquidity itself: price sweeps liquidity and then immediately retraces to test the inefficiencies or to take sell-side liquidity resting near the lows.
This is how large players generate profit — accumulating at the lows and distributing at the highs.

━━━━━━━━━━━━━━━━━━━━━━

After the most recent liquidity sweep into the TFVG, price formed an IFVG, confirming a shift in the local order flow. However, it is important to understand that such a shift in order flow must have an objective, and the ultimate objective is revealed through price reaction.
Yesterday, price tapped the 7000 level but once again failed to achieve acceptance in that area. This signals uncertainty.
For confidence in a continuation of the bullish move, we need further confirmation in the form of acceptance with imbalance formation around 7016 or higher.
If that does not occur, price is likely to revisit the Fair Value Gap (marked in purple).
In that scenario, the reaction from that zone will be key.

━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━

📉 NAS100 Analysis

━━━━━━━━━━━━━━━━━━━━━━

The situation on Nasdaq is similar, except for the relative weakness compared to SPX. This is evident in the fact that SPX has already printed a new ATH, while Nasdaq has only approached that area.
In other words, if U.S. indices start to move lower, Nasdaq will most likely decline more aggressively — in terms of pure range, it tends to deliver a larger move.

━━━━━━━━━━━━━━━━━━━━━━

Price has achieved acceptance above the last high, meaning external liquidity has been taken.
I will be waiting for price to return into the internal area of interest for position rebalancing.
The key confirmation for confidence in the continuation of the bullish move, in this case, will be SPX.

Feel free to ask your questions in the comments.


Enjoy!

Feb 1

Trade active

📌SPX

The weekly close increases uncertainty regarding the continuation of the bullish scenario: price swept liquidity that also marked the ATH, but failed to hold above it and pulled back. This indicates that the orders resting around the ATH were absorbed by institutional players, meaning this area is temporarily protected and will be difficult for price to reclaim.

Price has formed two deviations — one to the upside and one to the downside — creating a range with liquidity taken above and below. This points to a potential consolidation within the area marked by the purple rectangle.


In this case, the operative trading range is the zone highlighted in blue.


On the daily chart, as expected, price has reached the purple zone for rebalancing. Given the broader uncertainty, we avoid setting targets for a large directional move and instead focus on more local price action.

• If price holds above the purple rectangle (daily candle body closes above the upper boundary), I will expect a local bullish move within the weekly range highlighted in blue.
• If price holds below it, I will instead expect a local bearish move within the same weekly range.



━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━

📌NAS100

A similar situation is unfolding on the weekly chart — price is compressed between two problematic zones, forming a range:


and a clearly defined trading range:


On the daily chart, Nasdaq continues to confirm the weakness discussed in the previous post. Price failed to print a new ATH, and this weakness is further confirmed by the inversion of the last key area of interest (purple rectangle).


━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━
Trading approach📊

At this stage, I will focus on trading within the previously defined ranges:

• If SPX manages to hold above its key zone, I will look for long opportunities on SPX.
• In the alternative scenario, I will look for short opportunities on NAS100.

Enjoy!

Feb 5

Trade closed: target reached

Hi everyone🤝🤝🤝

As expected, SPX is trading within the range we discussed in previous posts. At the same time, NAS100 has pushed lower, once again confirming its relative weakness.

At the moment, an interesting mid-term setup is forming.



The price on the underlying asset is not taking seller-side liquidity, while futures positions are printing a new low.



This type of price dislocation suggests that long positions are being accumulated within this range. In this case, I would like to see confirmation of my idea through an inversion of the zone where sellers were highly active (marked in purple). If that happens, I will stick to a long narrative.

However, if the price aggressively closes below the low it failed to break today, I will shift to a short scenario.