Daily Plan 12.5.23
Welcome back everyone!
Today's trading session was indeed a remarkable one. Stocks, particularly in the tech sector, experienced a significant sell-off, only to be met with a robust bounce towards the end of the session. This development was not entirely unexpected, as we approached a major value area low in the S&P 500, which received evident support. The price managed to dip only a few handles below my short target before it began to reverse and climb back up. Beyond the realms of tech and the S&P, both gold and oil also witnessed major movements today. I had extended my long target for gold up to 2115, a move that proved to be quite conservative as we observed an extreme surge up to the 2150s. Although these levels did not sustain, the potential for a squeeze was present, and those who maintained their positions experienced a rather disappointing day, especially from a short-term perspective.
For some time now, I have been emphasizing that gold is poised for a strong move towards an all-time high (ATH), given the current market environment. Remarkably, this is unfolding even as the indices remain robust. Take, for instance, the Russell and Dow, on which I have been focusing for swing long positions since November 17, 2023. The Commitment of Traders (COT) reports indicated a significant accumulation of short positions, which in turn has driven higher moves in both the Dow and Russell.
Looking ahead to tomorrow, I will delve into my analysis of the S&P 500's profile, along with all the insights that can be gleaned from the Volume Profile. This analysis will be crucial in understanding the market's dynamics and in identifying potential trading opportunities. By examining the volume distribution and price levels within the S&P 500, we can gain a clearer picture of where the market might be heading and which levels are likely to act as key support or resistance.
Breaking Down the Profile
S&P500 (ES)
