Wednesday December 4 2024 SPY SPX ES Actionable Levels

$SPX chops and dips & defends to cling to ATH. Has $SPY run out of steam?

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In yesterday's letter, we wrote:

For tomorrow, I am closely watching the key SPX levels of 6040, 6028, and 6017.

If we dip and defend at 6040, that would be extremely bullish. A long entry at 6028 would be even better. Then, we can target 6060…

If we chop without really making a move, it is likely above 6017 and below 6060 or so.

This is what happened. The market opened and failed to hold the 6040 level, which was critical for a bullish sentiment. We got close to dipping at 6028, where we anticipated a potential bounce, and indeed we did see a reversal right on cue. The market surged all the way up to a high of 6052.07.

See how well the levels work?

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Now that we’ve yet again held onto all-time highs, the question is whether we will remain in this upward trajectory or when we’ll see a significant pullback. What levels below will provide us support, and what targets above should we be focusing on?

More in the trade plan below.

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

Levels played out quite well today as we drifted down and saw the expected bounce as we approached 6028 support. Always trust the levels.

Now we are sitting in AH right on the key 6046 support level. What does this 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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Don’t miss the Topic Directory - Getting lots of questions that are answered in here.

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Trading Plan

We printed another very narrow range green candle right at all-time highs, though it came on lower volume compared to previous days. Volume remains comparable to yesterday, indicating a cautious market sentiment.

Looking ahead, tomorrow we have ADP job numbers and PMI data before/as the market opens, followed by Powell’s remarks in the afternoon. These events could lead to increased volatility as traders react to the economic data and potential implications for future monetary policy.

I am receiving some great questions from beginners. This is helping me develop guides for this group as well as the course. More to come but I’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, I’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.

For tomorrow, I am closely watching the key SPX levels of…

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