Friday Oct 27 2023 SPY SPX ES Actionable Levels

$SPX continues the break down. What critical $SPY levels will tell us where we head next?

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SPY Options
October 26, 2023

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In yesterday’s letter, I wrote:

❝

“For tomorrow, bears continue to be in control. As we continue making lower lows and not reclaiming and then holding levels the sellers continue to show their strength.

For tomorrow, we need to hold the 4167 level at lowest or fail and reclaim (or ideally not even test) in order to put in a bottom and reverse higher…

If we do not defend the 4167 level then we will see 4163, 4156, 4150 and 4140.

On volume we could see deeper into the lower 4100’s but it’s unclear as there is very little support until we get to 4112.”

This is precisely what happened. We lost the critical 4167 ‘must hold’ level and it was all downhill from there. We even ran through all the above levels as well as tested another level provided yesterday, 4131 and put in a low of the day at 4127.9.

See how well the levels work?

Now that we’ve further broken down into a new range, how much deeper could we go and what critical level will tell us that a bottom is near?

More in the trade plan below.

The 0DTE $SPY 416 puts ran from a low of $100 to $440 = 340% gain.

I traded these from $130 to $367 at best sale for 182% gain. This trade was called out in the chat and was entered a bit earlier than I typically trade. It was not long after the open and very close to highs of the day. 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 last night were reliable. They clearly showed where we had support and where we were struggling against resistance. I used the latter to enter short at the high of the day not long after we opened the regular session. Always trust the levels!

Now we are sitting in AH right on the 4152 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.

Key Notes

This is not financial advice. This helps keep me honest and is a place for my notes. It is for educational purposes for all who choose to subscribe. Not all investments are suitable for all investors.

I try to trade less than 3 moves per day. Most days are chop and there are usually less than 3 great high confidence setups.

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