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In Friday’s letter, we wrote:

This is what happened. Overnight in the Sunday futures, we managed to dip and defend just above the 6844 SPX long the dip level, which triggered a strong rally that took us back through the 6906 level, resulting in a move of over 60 points. However, after the opening bell, we encountered resistance just shy of the key 6917 level, falling short by only four pennies (with the high of day at 6916.96).

As the day progressed, sellers took control, and we systematically lost support levels one by one. The critical 6828 must-hold level was breached, but we did manage to rally back to 6855 before dipping again. Ultimately, we continued to defend the 6828 level into the close, but the pressure was evident. $SPY ( ▼ 1.02% )  $SPX ( ▼ 1.04% )  $ES_F ( 0.0% )  

See how well the levels work?

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Now, as we look ahead to tomorrow, we must ask ourselves: how do we react to this significant pullback? Are we prepared to defend our levels or consider shorts if we break down further?

More in the trade plan below.

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

The 60 point run overnight after defending at 6844 SPX, the 4 cent shy of key resistance at 6917 and the continued defense of 6828 throughout the regular session are prime examples of the supports and resistances at work. Always trust the levels.

Now we are sitting in AH right on the key 6845 support level. What does this mean and where do we go from here? Read below for our 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.

If you are enjoying this letter, consider sharing with a friend! We even have a referral program where you can earn free subscription time for referring others that sign up for a paid subscription.

Don’t miss the Topic Directory - Getting lots of questions that are answered in here.

There seems to be some confusion as to the premium subscription and the discord chat. If you are premium and you do not have access to the “Premium Members Only” channels including “members-only” please authenticate yourself in the “bot-request-premium” chat. Or send me a DM in the discord!

Also - if you missed it - join our chat during market hours for premium subscribers. We are now leveraging discord for this. Link is at the very bottom of premium content: Trading Plan section below.

Trading Plan

Today was a massive 1% down day on higher-than-average volume, highlighting the shift in market sentiment.

For tomorrow, we have a critical lineup with seven FOMC member speeches scheduled, along with Trump delivering the State of the Union address in the evening. These events could spark further volatility, and we need to stay nimble and ready to adjust our strategies as necessary.

We are receiving some great questions from beginners. This is helping us develop guides for this group as well as the course. More to come but we’ve created a separate channel in the discord just so you can not be shy about bringing those questions to the group. No question is dumb, we grow stronger together!

In fact, we’ve created this single resource as a guide. It is a living document and we will continue updating it. You must be logged into the site to read it:

https://letter.spyoptionsactionablelevels.com/p/strategy-guide-the-basics

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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