Daily Plan 12/1/21

Dips Getting Dippier

Folks:

I wanted to get out my levels and thoughts for tomorrow a little earlier than usual as I have to head out in a few.

Session Recap:

My primary thesis today was being bearish if we opened/offered below 4650 and being bullish if we opened/bid above 4650. We opened below 4650, however by the time Cash session opened for business, my target levels had been already hit.

I then sent a follow up Twitter post , a couple minutes before cash open, with 4646 as potential resistance and 4600 as being potential support. We traded down to 4600 shortly thereafter for a 40+ point zipper .

Tic 4646

Once we traded down to 4600, I was bearish at the lows due to heavy lots trading on the bids and reiterated this in my post here Toc 4600 More Sell

Finally around 10 am local time, I became bullish at 4560 as I felt TRIN was extreme at almost 3 and we are now trading about 40 handles up from the lows of the day , now 4596. This is as of 11 am and could change as remainder of the session plays out. 4597 is a key level.

Tic 4560 LOD

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My Plan for Tomorrow:

Right now I am quite binary in remaining intermediate term bearish below 4600. I think the values are progressively moving lower. Breakouts are failing and get sold after falling back into the value areas. See Figure A with volume build up right under 4600 which may play a key role in tomorrow’s auction.

From a fundamental perspective, while I think omicron variant is a non-factor for the S&P500 , today’s Powell testimony is pretty damning and disheartening for any one wanting to be bullish.

Then there is the question of month end rebalancing . Using relative performance, it does seem money is flowing into safe haven stocks like AAPL and TSLA, both of which are my stocks and did very well on a day like today. TSLA also has a rumored stock split coming up next week so that may be a factor as well.

Today is a very high volume day, on track to be a 2 million + lot day. I always keep track of such days as they tend to play role of support and resistance , days and weeks out.

With this backdrop, I put together the following 2 price scenarios for tomorrow:

Scenario A: For Bullish auction, in my opinion the following needs to line up:

An OPEN above 4600 with TRIN values in healthy range of 1 or below. If we get to open above 4600, and shortly bid above 4620 , this will be a bullish opening for me with opportunities to lean against dips at 4612-4620. My targets in this case will be recent order flow pivot at 4650.

Scenario B: An open or a market that opens above 4600 but gets offered below 4600 may be a bearish scenario with the rallies being sold on rips.

This scenario may get amplified if TRIN opens below 1 but starts crawling above 1-1.5 range. Any prints into 2 + range will be extremely bearish for me, given the current context. My target will be a retest of 4540 . 

Now while 4540 , if we get there, is a solid support, that doesn’t mean I will blindly buy it. See context from my Weekly Post 2 days ago why S&P500 sell off may turn to a rout below 4540 due to the contextual importance of that level.

This is it for today’s plan. I am trying to get out at least 2 , if not 3 posts on order flow before the holidays and should hopefully make for fun Christmas weekend reading 😊for subscribers. Stay tuned, more on that later! As always, feel free to share the post and subscribe if this added value !

As always, if these levels get hit overnight, updates if any will be issued on my Twitter and Telegram early AM 👍

Figure A: Tuesday volume build up below 4600

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