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What we’re reading:

In yesterday’s letter, I wrote:

This is what happened in the first part of the day and the last part of the day. No, we did not need to get down to 4857 but we did reclaim the key levels and bounce up to a high of 4898.15 just below the 4903 target.

See how well the levels work?

We chopped overnight and blasted higher on data premarket. We got continuation after the open and ran to the days high before selling off hard.

Below is a 1 min chart of SPY. I chatted in our group at the same min as the candle highlighted:

10:31 AM candle marked in orange arrow.

Of course I didn’t take this trade. Would have been my best trade of the day.

Now that we filled out this new range a bit more, closed near the highs, which way will we break?

More in the trade plan below.

The 0DTE $SPY 488 calls ran from a low of $37 to $78 = 111% gain.

I traded these from 52 to 62 for quick 20% and I also traded some 4850 put lottos from .50 to .55. They ended up running to 1.20. I also traded futures. Do you ever find the days you trade the most should be the days you trade the least and the days you trade the least probably are days you should have traded the most? I had one of those. It was a volatile day and while I made out OK and had some decent trades, I also had some poor ones. Luckily my good trades made up for my bad trades but I should not have been trading as much as I did. When I look back at a chart of today, I can make the case that I should have traded once, maybe twice. That’s it. You want the entry you can hold, and there were several of those, including the one listed above when we were near the top of the range. Instead of taking the one good trade, I kept chasing mediocre ones. It’s ok, that happens sometimes, but we’ll discuss. More in the trade recap below.

Below, we’ll cover the actionable levels, how I played them today and what they mean for the next session.

Levels from the prior letter were alright. But again, I should have picked one or two good entries and that’s it. I think I kept trading because I was long in premarket before the initial blast higher and missing that ruined me from having a one and done mentality, I kept chasing. Always trust the levels!

Now we are sitting in AH right on the 4885 key support level. What does this all mean and where do we go from here? Read below for my trade plan which includes actionable support & resistance levels, outlook for the next session and today’s trade recap.

Learn the system to make 1-3 low risk, high reward trades per day using SPY/SPX options.

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Trading Plan

Here is a current check of the daily:

This includes all the way back to 6/29 & all overnight action.

We printed an inside day with a higher low and lower high. We are filling out a new range and the macro trend has been up.

Quick volume check:

Similar volume - nothing to see here.

Tomorrow we have a set of data prior to the open including PCE and then it’s a mostly quiet day.

As readers know trading after a massive move in either direction is risky.

Trying to predict when trend will break is a fool’s game because the trend can be stronger than you ever realize.

Going with the trend is hard because it has already run so far (or dropped) and move may be close to over.

All you can do is pick your entries carefully and with proper position sizing. Trading out 1-3 DTE or further also helps soften the blow.

Yes it will decrease the amount of profit but will greatly help keep you in a trade long enough to see return.

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