January 30th, 2024

The path of least resistance remains higher. The market environment is still in range expansion for ES and NQ, and as of today, there are no signs that it is ending. The little pullbacks we have seen along the way continue to be buying opportunities, and I expect that to continue today. Earnings, FOMC, and data that I talked about yesterday continue to be areas out of our control, but will be factors as each day closes out this week. Nothing we can do about that, but manage our risk and stay on the side that has the path of least resistance and has been rewarding us for a couple of weeks now.

Keys to watch today in ES: We are sitting at a 2 standard deviation away from the YTD AVWAP at 4944.25, and that can be an area to keep an eye on for the momentum to continue. If that area gets violated on the open, we could drift back down to yesterday’s RTH AVWAP at 4932, and it will be a key area for the bulls to hold. If these areas can hold into the afternoon, then I think we continue to new highs once again. If they can’t hold, it may be a day of rest for the bulls, and I wouldn’t fight the tape.

RTY and ZN remain rangebound and still not on my radar to give a clear signal for the next move. Tomorrow’s FOMC Meeting is very important to those markets, and with them remaining in what I consider a two-way tape zone, I am not interested in trading them right now.

NQ still has momentum and is favored to the long side, but since they reached my target price, they are not favored to trade over ES at this current moment.

Remember to focus on what you can control: your risk and trade decisions. Don’t worry about the rest that is beyond your control. Stay vigilant and act smart.

Cheers,
DELI