Bullish Stats Favor First Trading Day of November

But it's also an FOMC Day

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Our View

We are going to keep things short and sweet today.

The only thing I can say is the markets saw a lot of two-way price action at the end of October. I keep flipping back and forth, but I think we will see some type of year-end rally. I know a lot of people don't think so, but I think Santa will show — it's just a matter of when. 

Is it beginning now? It looks like the ES is trying to move up, but it still faces a very large uphill battle. Don’t forget: We have the Fed announcement this afternoon and Powell at 2:30 p.m. ET. 

Our Lean — Danny’s Trade

This is Danny Riley’s personal trading plan for the day.

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MiM and Daily Recap

ES recap, 15-min, multi-day

I want to remind everyone about MrTopStep's trading rule that there are three parts to the trading day: 

  1. What happens on Globex

  2. What happens after the 9:30 ET open

  3. What happens in the final hour (3:00 to 4:00) 

The ES traded up to 4199.75 and opened Tuesday's regular session at 4191.50. After the open, the ES traded 4193.25, sold off down to 4176.75 and for the next 26 minutes did a sideways-to-lower back-and-fill. The ES then printed a new low at 4171.75 at 10:06 and traded up to 4190.75 at 10:12, pulled back a bit and then rallied up to 4192.50 before selling back off down to a 4177.75 double bottom. From there, it rallied 14 points up to 4192.00 at 10:46 and then rallied again up to 4195.75 at 10:55. 

For the next hour, the ES back-and-filled at the VWAP, made a low at 4183.75 at 11:53 and traded up to 4211.00 at 2:00. After the high, the ES pulled back to the 4200 level, rallied back up to a new 4215.00 double top and pulled back to 4205.50 at 3:42 as the early imbalance showed $629 million to sell. The ES traded 4210 as the final 3:50 cash imbalance flipped to $864 million to buy and traded 4113.25 on the 4:00 cash close. After 4:00, the ES sold off down to 4202.00 at 4:59 and traded 4204.00 on the 5:00 futures close, up 19 points or 0.45% on the day.

In the end, it was all about buying the dips and the late-day walk away. In terms of the ES's overall tone, it was on the firm side. In terms of the ES's overall trade, volume was steady: 316k traded on Globex and 1.44 million traded on the day session for a total of 1.746 million contracts traded.

Technical Edge

  • NYSE Breadth: 68% Upside Volume

  • Nasdaq Breadth: 65% Upside Volume 

  • Advance/Decline: 72% Advance 

  • VIX: ~18

S&P 500 — ES Futures

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Guest Post

Topic: PTG/Taylor 3 Day Cycle

Author: David D Dube’ (a.k.a. PTGDavid)

Prior Session was Cycle Day 3 (CD3): Market continued to extend this cycle's rally fulfilling upper Penetration Level (4210.75). Prior range was 48 handles on 1.756M contracts exchanged. 

 …Transition from Cycle Day 3 to Cycle Day 1

This leads us into Cycle Day 1 (CD1): Markets may retest prior high before the next decline unfolds. Today is FED DAY with the FOMC Statement @ 2pm followed by Presser @ 2:30 ET. We are anticipating relatively quiet trading ahead of the release, with potential for seesaw action thereafter. Today is also Cycle Day 1 with Average Decline measuring 4180 handle. As such, scenarios to consider for today’s trading.

Bull Scenario: Price sustains a bid above 4200, initially targets 4230 – 4240 zone. 

Bear Scenario: Price sustains an offer below 4200, initially targets 4180 – 4170 zone.

PVA High Edge = 4210       PVA Low Edge = 4182         Prior POC = 4188

*****The 3 Day Cycle has a 91% probability of fulfilling Positive Cycle Statistics covering 12 years of recorded tracking history.

For more detailed information for both bullish and bearish projected targets, please visit: PTG 3 Day Cycle and/or reference the Cycle Spreadsheet below:

Link to access full Cycle Spreadsheet  > > Cycle Day 1 (CD1)

Thanks for reading,

PTGDavid

Economic Calendar

Disclaimer: Charts and analysis are for discussion and education purposes only. I am not a financial advisor, do not give financial advice and am not recommending the buying or selling of any security.
Remember: Not all setups will trigger. Not all setups will be profitable. Not all setups should be taken. These are simply the setups that I have put together for years on my own and what I watch as part of my own “game plan” coming into each day. Good luck!

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