January 23rd, 2024

The grind to 5k. It’s a new day, but the look is still the same. ES appears to be in grind mode higher, hugging the top of the daily Bollinger Band as it expands outward, heading towards the target of 4974 and potentially up to 5k.

The NQ has a similar look as it is grinding higher, up to its target of 17,777. The RTY is in catch-up mode and has a chart that looks nothing like ES or NQ, but nonetheless, it’s searching for higher as it has finally regained the YTD AVWAP.

The only negative I see on the tape right now is 10 YR (ZN). It cannot rally, and rates continue to grind modestly higher. The market doesn’t seem to care about this right now as all eyes are on the FOMC meeting in just over a week. However, if ZN starts to scream lower instead of grind lower, that would be the only concern I have for being long Indexes right now, versus some other geopolitical event that can always change things on a dime.

My plan is to look for breaks to buy in ES and not even consider shorts. The only way I stop looking for breaks to buy is if ZN screams lower or ES gets back below 4820.

Small and smart, and no fading rallies in this tape.

Cheers, DELI