September 20th, 2024

Day 3: OPEX. How we close today likely sets the tone for the coming weeks of the market. Barring a major selloff taking out the lows following the FOMC announcement, any close above there would be considered bullish in the coming sessions. If we were to give back all of the gains following the FOMC announcement and close below that days low, then the sellers carry momentum forward into next week.

For today’s trade, I see a tough tape in ES and NQ. For YM and RTY, I see an underlying bid in those markets as YM has the most upward momentum and RTY has an underlying macro bid with rates likely to fall for the foreseeable future. For those reasons, I like long signals in YM and RTY over ES and NQ. ES and NQ are likely to have a more volatile tape today, and I think they can be traded on both sides using your short-term strategy, but would still favor buy signals over short signals.

As my brother Pax says, it’s capital preservation Friday, and do not ruin the week or the weekend by taking on unnecessary risk. We learn about the tape from today’s close, so be patient, watch and learn, and if you get an A setup on your strategy, keep it light and tight.

Wishing you all a wonderful weekend.

Cheers, DELI