Monthly Levels for October are Here

U.S. stock indexes finished mixed today, marking the close of both the month and the third quarter. Growth and technology stocks carried the Nasdaq 100 (NDX) into positive territory with a 0.2% gain. However, the S&P 500 (SPX) slipped 0.25%, and the Dow Jones (DJI) dropped 0.9% (DIA exceeded the bearish target of 511). Early-day optimism made the SPX reach the anticipated daily resistance of 7,720 and reversed rapidly towards 7,649, another level modeled yesterday for today’s session showing a how institutional algorithms react to these modeled levels with precision. Long-dated bond yields continued to weigh down the broader market, with the 10-year U.S. Treasury yield jumping to a new multidecade high of 5.30%. The market wrestled with contradictory economic signals: The Federal Reserve’s preferred inflation gauge, the August Personal Consumption Expenditures ( PCE ) price index, came in lower than expected rising 0.3% for the month and 3.4% year-over-year (vs. 3.7% expected). Core PCE (excluding food and energy) rose 0.2% for the month and 3.0% year-over-year. However, the second-quarter real GDP was revised upward to a 2.2% annualized growth rate, proving the U.S. economy remains resilient and offsetting the cooler inflation data. As mentioned today is the end of the month and quarter, and many disciplined investors and traders are looking forward to the support and resistance levels for October, and that is the focus of today’s edition, bringing the essential central monthly level (CML) that sets momentum for a longer term structure, this level comes for our regular watchlist in this post, and the founding members site ( access here ) has the levels updated for the expanded watch as well. Today’s Agenda Monthly Levels for October Watchlist Tracker and setups analysis for SPX, QQQ, TSLA, AMZN, SPCX, GOOG Micron Earnings Report Breakdown Multi-timeframe levels combined for SPX, ES=F, MU, NVDA, AVGO, AMD Daily plan for SPX, ES=F Let’s begin. MONTHLY LEVELS FOR OCTOBER Securities marked in red indicate they have lost the crucial central monthly level, making volatility likely, especially if the ticker is close to its all-time highs, such as the Dow Jones or DIA and IWM (both anticipated as bearish setups). At the same time, let's remember that bounces occur from oversold conditions. Some tickers are showing overextended conditions and could trigger corrective moves similar to those anticipated and printed by SPCX, BTC, TSLA, NFLX, and GLD in August, or META, AAPL, and AMD in September. Let's examine the analysis first: Read more

Gap Filled... for the SPX

The stock market struggled to find footing today as a surge in U.S. Treasury yields continued to pressure risk assets. Both long- and short-term government bond yields pushed to levels not seen in decades, capping any meaningful rebounds in equities. The benchmark 10-year Treasury yield climbed to 5.29%, marking its highest peak since 2007 , while the 30-year yield surged to 5.62%, its highest mark since 2002 . Adding to the bearish sentiment was a duo of weak economic reports. Data from The Conference Board revealed that U.S. consumer confidence has slumped to its lowest level since 2014 , driven by anxieties over the cost of living and the labor market. This was followed by the Labor Department’s Job Openings and Labor Turnover Survey (JOLTS), which showed U.S. job openings fell to 7.09 million in August . Missing economists’ forecasts, this indicates a cooling job market ahead of Friday’s highly anticipated nonfarm payrolls report. We studied during the weekend the structural cracks in the SPX , yesterday the breach of the Central Weekly Level suggested negative continuation, and for today, the anticipated Central Daily Level (CDL) at 7,691 (the demarcation point for bullish or bearish momentum for the day) was breached during the first minutes of the market open. Selling pressure pushed the index down to our anticipated daily support level at 7,658 , where it found stability, validating how institutional algorithms react to these modeled levels updated every day for the next session. The gap at 7,657 from last week was filled as anticipated, all the gains from Monday, September 21st, have been wiped out. As I highlighted that Monday afternoon, chasing the rally carried significant risks and that gap was going to be filled. Today’s Agenda Daily and Weekly Levels Combined for SPX, ES=F, NVDA, AMD, AVGO, and MU Daily plan for SPX, ES=F Watchlist Tracker - Zoom in to GOOG, TSLA, SPCX, and AMZN Subscribe now Daily and Weekly Levels Combined for SPX, ES=F, NVDA, AMD, AVGO, and MU Let’s begin with Micron ( MU ) the company will be posting earnings tomorrow after the market close, the implied volatility for the stock is an expected price move of roughly 7.7% to 8.1% : Read more

Volatility Spiked - Daily Plan for Sep 29th

Rising yields and Hormuz risk pressure equities; IWM expected lower near term

SPX: Do Price Gaps Always Fill?

A gap represents a distinct break in the price action of an asset’s chart. It occurs when the price of an asset opens at a significantly different level (either higher or lower) than its previous day’s closing price, with no trading occurring in the price range between the close and the open. Visually, this creates an empty space or “hole” on the chart, which is often highlighted by traders (as seen in the yellow boxes on your chart). Gaps typically occur when significant news, earnings reports, or economic data are released while the market is closed, leading to a sudden shift in supply and demand before the next trading session begins. Price action is generally considered a continuous flow. A gap interrupts that flow, meaning that not every price level between the previous close and the new open was traded. From a technical analysis perspective, this skipped price range represents an area of “inefficiency” or a “vacuum” where normal buy and sell orders were momentarily absent. Why are they usually “filled”? (And why do algos fill them?) The phrase “filling the gap” means that the asset’s price subsequently moves back into the empty price range created by the initial gap. There are several market-based reasons why this often occurs: 1. The “Price Vacuum” Effect: As mentioned above, the price range within a gap has not been “auctioned” or tested. When the price retraces back to this level, it is often met with less resistance because there were few, if any, prior orders executed there. This makes it easier for the price to traverse that specific zone. 2. Profit Taking and Retesting: Often, a gap is caused by an emotional, one-sided move (e.g., panic selling on bad news or euphoria on good news). Once the initial momentum slows down, traders who profited from that move may start taking gains, causing the price to pull back. This pullback naturally gravitates toward the last known price point before the emotional move occurred; the pre-gap closing price. 3. Algorithmic Trading (Algos): Modern markets are dominated by algorithmic trading systems. Many of these algos are programmed to recognize technical levels like the ones update every week here, including unfilled gaps. Algorithms often treat these empty zones as “imbalances” or “liquidity voids” that need to be corrected. Algos may act as a stabilizing force by aggressively buying into an oversold gap down (anticipating a reversion to the mean) or selling into an overbought gap up. This systematic trading pressure helps facilitate the move back to “fill” the gap. With all that said, today’s move improved the price structure we have been tracking during the week. However, the question is not IF but WHEN will the gap at 7,657 will be filled for the SPX; the chart below highlights with a yellow rectangle gaps printed by bullish moves during the last months, see that sooner or later they were filled. The one opened on May 5th had bullish continuation with a +4% move before a rapid flush happened in the beginning of June wiping out the bullish move. The same happened with the gap opened on August 4th, with the price gaining 2.5% during the next days until the move was completely wiped out by September 10th. Will this time be different for the SPX? No, it won’t. We will navigate the move aware of this magnet which the sooner it gets filled, the better for bulls. From here the clock is ticking for any bullish move, and the way how we have navigated price action has been with the modeled support and resistance levels. We didn’t wait for a -4% loss in June, the central weekly level of that week at 7,559 was breached on June 5th triggering bearish momentum capital and gains protection from a bearish move that bottomed at 7,237. Same case on September 8th when the central weekly level of that week at 7,651 was breached (as anticipated), protecting capital and gains from a drawdown to 7,507.7 The central weekly level (CWL) and the layers around where institutional algorithms react are mod

The Definitive Chart to Watch This Week

Daily plan for Friday, Sept 24th - Levels for SPX, ES=F, TSLA, GOOG, META, AMZN, MSFT, AAPL, and NVDA. Special zoom in to AMD Daily plan for Friday, Sept 24th - Levels for SPX, ES=F, TSLA, GOOG, META, AMZN, MSFT, AAPL, and NVDA. Special zoom in to AMD.