Monday Dec 11 2023 SPY SPX ES Actionable Levels

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In yesterday’s letter, I wrote:

This is what happened. We managed to reclaim the 4581 level overnight, lose it and then reclaim prior/post market open. This launched us all the way to a high of 4609.23 above the 4600 target.

See how well the levels work?

Now that we’ve begun the process of breaking out, what do we need to be aware of to ensure we don’t fall right back into consolidation? What key levels below us are ‘must hold’ and what are next targets above?

More in the trade plan below.

The 0DTE $SPY 460 calls ran from a low of $21 to $108 = 81% gain.

I traded these from $68 to $100 at best sale for 47% gain. This was my second trade of the day called out in the chat. This was after trading puts earlier in the session and exiting 70% of the position for profit and being stopped out on the remaining 30%. 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 reliable. When we bounced right off the critical level prior to open it was a clue where there was demand and support. We then blasted even higher after a retest of the key 4581 level. Always trust the levels!

Now we are sitting in AH right under the 4605 key resistance 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.

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Trading Plan

Here is a current check of the daily:

This includes all the way back to 3/30 & all overnight action.

Today we had a higher high and higher low and we are barely peaking our head out of the top of this range.

Quick volume check:

Higher volume than all sessions since late October. This is strong confirmation of today’s move.

Monday we have the 10 year auction in the afternoon but all eyes are on Tuesday for CPI and Wednesday is PPI/FOMC.

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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