S&P 500 INDEX MODEL TRADING PLANS for TUE. 6/25/24
Markets continue to appear in a consolidation mode, waiting for a catalyst to set the direction of the next leg. This Friday’s PCE could be that catalyst. Last week’s Initial Jobless Claims, Housing Starts, Building Permits, Philly Fed Manufacturing Index…all point to a cooling economy, on the heels of last week’s softer than expected PPI confirming the trend of the softer CPI. Would this push the S&P 500 Index futures to continue to print more all-time highs OR would this begin to start clamors of “Fed might fall behind the curve”? There may not be clarity on this front until after this Friday’s PCE and into early next week.
For the last few weeks, the positional bias published in our trading plans has been: “It takes a daily close below 5200 for the models to turn bearish”. The PCE-driven whipsaw move saw the index briefly breach the 5200 level – printing 5191.68 as the session low – before staging a stunning reversal that took the index on a swift, V-shaped rally of about 80-points to close more than 85 points above from that low.
Since flipping to a bullish bias on the break of 5116, our models continue to be bullish. Models would carry this bullish bias while the index is above 5412 on a daily close basis. It takes a daily close below 5347 for the models to turn bearish. Between 5412 and 5347, models would be in an indeterminate mode.
Aggressive, Intraday Trading Plans:
For today, our aggressive intraday models indicate going long on a break above 5502, 5473, 5465, 5450, or 5422 with a 9-point trailing stop, and going short on a break below 5499, 5462, 5447, 5439, or 5419 with a 9-point trailing stop.
Models indicate explicit long exits on a break below 5471 or 5458, and explicit short exits on a break above 5442. Models also indicate instituting a break-even stop (which would trigger on a break above/below the entry level) once a position reached a 4-point profit level. Models indicate taking these signals from 11:01am EST.
By definition the intraday models do not hold any positions overnight – the models exit any open position at the close of the last bar (3:59pm bar or 4:00pm bar, depending on your platform’s bar timing convention).
To avoid getting whipsawed, use at least a 5-minute closing or a higher time frame (a 1-minute if you know what you are doing) – depending on your risk tolerance and trading style – to determine the signals.
NOTES – HOW TO INTERPRET/USE THESE TRADING PLANS:
(i) The trading levels identified are derived from our A.I. Powered Quant Models. Depending on the market conditions, these may or may not correspond to any specific indicator(s).
(ii) These trading plans may be used to trade in any instrument that tracks the S&P 500 Index (e.g., ETFs such as SPY, derivatives such as futures and options on futures, and SPX options), triggered by the price levels in the Index. The results of these indicated trades would vary widely depending on the timeframe you use (tick chart, 1 minute, or 5 minute, or 15 minute or 60 minute etc.), the quality of your broker’s execution, any slippages, your trading commissions and many other factors.
(iii) For the execution of our models trading plans, a “break above/below” is deemed to have occurred when the index closes above/below (if you are trading by bar close) a specified trading level.
(iv) For the trades to trigger, the breaks should occur during the regular session hours starting at 9:30am ET. By design, they carry only one open position at any given time.
(v) These are NOT trading recommendations for any individual(s) and may or may not be suitable to your own financial objectives and risk tolerance – USE these ONLY as educational tools to inform and educate your own trading decisions, at your own risk.
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