For sometime now, ES 5620 has been a MAGNET in price.
It was the consolidation and selloff end of day March 28 leading to a gap down and bottoming around 5533 (our runner holds from 5545). It was a stall point on the rally up Monday a1 PM EST before we broke thru to 5680. It was the level that held 9PM EST on 3/31, and 7:30AM 4/1. We flushed it into 5606 (Trade #2 on April 1) at 10:10 EST on April 1st before reclaiming and going to 5690. We again used it as support 2:45 4/1. And finally, we used it this morning after a 1% selloff from 5695 to 5612.
This morning we offered readers an opportunity to buy at 5612 when the AM letter found here: https://theesdaily.substack.com/p/april-2-es-levels-and-gameplan
Noting:
Likely Supports For 4/2 are: 5612(D)
5610.75 was the low of the day.
Needless to say 5620 is used up.
While price offered many opportunities today, I chose to not take any trades and let my 5545 runner work.
- 0 Trades
5545 Runner moved from 5585 to 5600 to 5565 as it stands now.
That’s a 120 point runner on ES.
We’re OK with that.
Let’s get to today’s action
This AM in the AM letter I wrote:
As we roll into this AM we’re seeing ES selloff a bit from the 5696 high.
Yesterday I noted looking for a 99 high and we fell just before that point. I said during our trades, after T1-T3 was hit:
This is what building structure looks like before the next leg.
Here’s what we look like this AM on a 30 minute:
As you can see, 5620 is a MAGNET
Something I’d like to point out I said yesterday that I repeat this AM…
In between the purple lines, you’ll see the words
Critical area that much hold for bull hope”
Interesting to see the low Monday at 8 and 9PM bounce from there and again this morning.
That is the reason we:
Leave critical areas on the chart (for a period of time)
Use critical areas as odds enhancers if we have additional support.
This is the staple example of a “price magnet” or when support turns into resistance or vis versa. We typically can see price use these areas 4/5 times before we move away from the level.
This is the 4th use here this AM. We saw the price consolidate and break the level Friday at 3PM. As ES found a bottom at our 5545 entry and took off, we tested the lower bound yesterday (after the morning rally) at around 1PM. Then we used it as support again at 9PM and now at 7AM.
We continue to use 5620 as a magnet.
We stopped out of our runners from yesterday’s trades during this morning’s selloff at 5620.
5620 held this AM and as I type we’re at 5707.
Today is Tariff Wednesday
Across the fin ecosystem it’s been the only thing traders have talked about today.
I noted:
Today has been touted “Tariff Day” and we’ll get news today on Trump’s plan for Tarriffs but it’ll likely be around the close at 4PM.
Expect movement. News from Trump is akin to large data news and it wouldn’t be weird to see ES swing a couple hundred points either way.
Expect volatility and ESDaily readers know what I’m about to say here :
Volatility brings opportunity.
We saw VIX fall from 22 -19.8 on this mornings rally and we didn’t find much as opportunity otherwise.
While we don’t typically trade news, we simply respect levels. The combination of 5620 being used up (8:30-9:30AM), 5650 reclaim (9:45AM) right into 73 supply, 5736 a counter trend opportunity (1PM), and 5675 having low momentum (2:30), we chose to not take any trades today. Just let out runners work.
Let’s remember these rules and profit strategy.
These come from our Core Strategy here:
ES Core Strategy
#4 60-75% of contracts are to be taken at T1
#5 10-15% of contracts are to be taken at T2
#6 Always leave a runner if permitted
#7 Limiting number of trades
Taking profits when they were due has led us to the following on the ES Daily Scoreboard:
I’ll take a day like today, where we could’ve taken Grade B/Grade C trades but chose to do nothing, and let our runner run. We keep our win rate high, reduce our risk, and wait for better setups.
Remember OverTrading Is The #1 Way to Lose Money
Let’s continue to hold the runner overnight, see what the night session brings us as we impatiently await any Tariff news from Trump.
While it isn’t ideal to see such moves in ES get away, we find solace in knowing we are participating via our runner. A lot of movement still likely to come around 4PM, hence the early letter today.
I’m looking at the following as opportunities post any tariff news through this evening before the AM newsletter:
Below: 5691, 5656, 5638, Less this, we look much further below and we won’t be buying any knives.
Above: 5728, 5740, 5776, 5795 into the Major ES Inflection Point.
We did our job today albeit ending up sitting still, and patient.
Trade Like A Robot
Be Back in the AM with levels and opps
-PT