Daily Plan 9/23 '22

Happy Friday!

From my plan last night, I had shared 3810 as the key intraday level which the bulls had to over come to trade up to 3860.

Link to the Plan.

This level provided much resistance for the bulls and were not able to take it out for remainder of the session all day today. This despite many chances provided by the market to do so.

Chart A below: Small Range SPY Auction.

Chart A SPY D1 Auction

On top of this level, I had shared with folks my thoughts over the weekend that I expect TSLA breakout to fail out of my weekly LIS. Here is the link to read all about it.

This was a tremendous call as the stock collapsed to 290 again, losing about 8% within a couple of days.

I was also a bear on COST for the earnings and that stock traded down about 15 handles at time of this blog. Notably I have been a COST bear from 560 and the stock has lost 20% or so within a matter of weeks.

With the market auction today, it may have set the stage today to see what is out there at 3717. While this level is still intact, there seems to be some over head resistance at 3810 which unless overcome, I think behooves the market to retest that key level I had shared weeks ago. The next 400 points or so will come from what happens down below at these key levels.

We also had substantial moves in the names like AMD and NVDA which I have been a bear from extremely long term- notably AMD closing below 70 key level.

As if this was not enough we also saw TLT come under more pressure today. It closed near the 105 level again on heavy volume.

Before I share my thoughts for tomorrow, longer term I do not have enough information to glean if this 3720 level is going to break, however I do think there may be short term more volatility to come in light of the related auctions.

QQQ similar auction to the SPY

Scenario 1: leaning on the Emini as long as it is above that 3765, I favor a test of 3810.

Scenario 2: An open or bids above 3810 could target recent OrderFlow level at 3860.

Scenario 3: If we open or offer below 3765, I think we may try and target 3720 which IMO is an immensely important level.

In general, these scenarios may be aided or impeded by where TLT and TSLA is. TSLA above 290 with the TLT above 106 could aid scenario 1/2.

To summarize, here we are now about 600 handles lower from where I reiterated my bearish bias at 4300. A lot of participants did not see this as possible yet we managed to gradually but steadily grind down so close to the June lows again.

I personally now favor a retest of 3950 before deciding next leg lower or higher from here. To get there will not be a single auction feat, we will first need to take out the 3810 resistance.

Based on related market analysis, we may retest that immensely important 3720 level before deciding that next 300-400 handle move in the Emini. We last traded around 3770 at time of this post.

Link to the weekly with longer term context.

Charts and auctions across the board look heavy. A conformation of the downside continuation could be a weekly close here below 3720- however, I think as long as that weekly close does not come by below 3720, there is still substantial fuel to power a move back to 3950 weekly OrderFlow Level.

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Shoppers line at the Costco