SPX and ES Jan 12th Update (Posted on Jan 11th in the main Room)

I was very loud for the past several days in our thetradersroom.net main room to Not Short the market after the Monday action, as it can extend higher.

Well, it extended into our “First Target” zone today. It still can be a higher high tomorrow, but looking for 3800 next week.


Here is what I updated our members with yesterday evening:

Nothing much to add to my NQ update, quite a similar structure.
One thing is that SPX can make a higher low when NQ should make a lower low if it breaks from the H&S pattern.

I see a lot of puts activity which are longer dated than calls. So if any spike tomorrow will be short-lived IMO
SPX closed right at the critical resistance trendline, so it simply can gap down tomorrow.

There is a fib confluence at 4025SPX as well as 3990-95SPX. There is a chance of the price spiking up to 4065, but if it closes below 3990SPX, it would be a false breakout.

  • So if CPI comes at the expected 6.5%, we can rally,
  • Even if it prints at 6.6 to 6.8%, it might produce a knee-jerk reaction and then fall apart (my ideal scenario)
  • CPI above 6.9% will be very bearish, and below 6.5% will be very bullishSPX_2023-01-12_00-45-15

Zoomed out a chart with the main target, 3390SPX MUST HOLD on any test in Q1!SPX_2023-01-12_00-47-45

Here is an option map for the Jan 20th expiration

Screenshot 2023-01-12 at 00-50-51 SPY Open Interest Volume and Max Pain

You can see huge call walls starting from 400 to 415.
If tomorrow we get a spike in am, I’m sure those calls will increase in open interest!
@Tracey reminded me about the JPM put and call play; they had sold 4150C exp on the 20th. I doubt they will let those in the money…

If the markets won’t spike up and start dropping right from the CPI release, I expect low 3800s to be seen tomorrow!

That to be told, regardless of tomorrow’s outcome, I think we sell into the following week’s VIX OPEX, and that sell-off can be pretty intense! So if we gap up, I will add; if not, I will add when we see the first main support broken.

I will be up in am to place a speculative trade; I hope to see either a squeeze into the CPI or some selling before a spike.



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