January 25th, 2024

Bulls defended the 5-day. Five days ago, we broke out, and I have been watching the 5-day SMA very closely to see if we can sustain above it. Last night, the bears had a chance to pull back below it, but the bulls stepped in and defended it. For now, that 5-day SMA will be a key area to watch for the bulls to continue their momentum up to the 4974 target. The 5-day is now a good place to keep stops below for swing positions.

Why the 5-day SMA? It’s something that is super simple (I like simple). Since we broke out 5 days ago, it’s a good testing spot to see if we can hold above it to keep the momentum.

NQ top Bollinger band is now above the target of 17,777, which just gives more confirmation that they are headed towards that target.

RTY continues to try and play catch-up, but it’s not a market I would be playing long in just yet. The ZN still struggles to hold rallies, and I think that is a headwind for RTY. The NQ and ES are still the markets favored for trading on the long side.

Don’t overthink this tape; the bulls are in control and they are defending the areas that they need to. Small and smart. I will be live on youtube at 1030 ET talking about that squeeze trade I went over in the livestream in Discord on Monday.

Cheers, DELI