November 18

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November 18 Pre-Bell Update

• Overnight Inventory is long. All of the action has taken place inside of Friday’s range so gap rules don’t apply. We are currently trading inside of Friday’s value area, so I will be looking for responsive trade by leaning against structural references.

• VWAP is currently sitting at 5903 which adds confluence to the 5903 psychological level.

• Notice that ETH buyers stalled right at the bottom of Friday’s single prints. Trading above the Overnight High will place us back within those singles.

• We have the Overnight Low at 5886.50 which is also where we have Friday’s Value Area Low.

• The options market is expecting a +/- 27 point move. If I use 5900 as the anchor, today’s extremes could be 5927 (near top of single prints) or 5873.

• At the open I will be looking for buyers’ ability to keep us above VWAP and hence above the 5900 psychological level. If we open below it, I will be monitoring for sellers who can keep us below that area.

November 18 Plan

On Friday we opened on a true gap below the November 6th single prints; sellers were able to keep us below it which resulted in a liquidation break towards the 5900 psychological level and then towards the bottom of the Balance Zone / target at 5881. We can consider Friday’s profile a “b shaped profile” which could mean “long liquidation”. This could mean that we saw some profit taking after the rally that we saw the prior week. Long liquidation breaks could strengthen the market since the “lower prices” could attract new buyers and they also take out potential sellers.

• With Friday’s move we traded inside the post election gap but that gap is still unfilled. In order to fill that gap, sellers need to take us all the way down to 5822. We now have a gap above us as well between 5941.75 and 5964.50. Within Friday’s profile we also have some single prints between 5915.50 and 5924.50. Sellers’ goal going into tomorrow’s session should be to keep us within or below Friday’s lower distribution. Trading above these single prints increases the odds of us seeing the end of Daily One Time Framing Lower which could in turn increase the odds of us seeing the gap fill at 5964.50.

Bullish Scenarios:

• Careful longs above the 5900 psychological level targeting the top of Friday’s single prints at 5924.50.

• Longs above 5945.50 targeting the gap fill at 5964.50.

Bearish Scenarios:

• Shorts at the top of Friday’s single prints are valid.

• Shorts below 5881 targeting 5852 followed by 5823.

Nasdaq:

• Longs above 20,585.00 targeting 20,677.00 followed by 20,930.00 or the gap fill at 20,950.00.

• Shorts below 20,500.00 targeting 20,372.00.

• Shorts below 20,372.00 targeting 20,200.00 followed by 20,027.00.