Pre-Market Levels 7.22.25
Quick recap of yesterdays session
I actually went golfing at lunch, and came back to that flush. Wasn’t expecting it, but also wasn’t surprised.
Looks like London was positioned net short, and started to close going into NY open.
Reviewing open interest in $SPX we do see that dealers were short gamma above 6300. Distribution like this I call “acceleration zone”.
After we get above the initial 6300 call wall dealer hedging will trigger causing a squeeze up to the next call wall, which was 6340. SPX high was 6336.
For me, this day almost doesnt count, aside from identifying that we did not put in a single selling tail in ES or SPX. This is the most notable thing I noticed.
This area between 6350-6370 in ES will have potential for price to move fast and whippy.
We did hit upside targets of 6360 / 6375 before flushing, which if you read my post from Sunday, I did mention I anticipated potential distribution as we approached these levels.
Going into today
I will be watching to see if we are able to hold this 6336 level, as of now, in ETH it is holding.
As a side note, I have these colored zones which I determine as my potential supply/demand zones, I try to restrict my execution in this type of market cycle to reduce risk. It is also to remind me not to chase shorts and longs, since there is potential for mean reversion as we approach these areas
Sometimes, the best thing to do is sit on your hands.
As of now, market is in-between 6330-6350, which again if you read my positioning from Sunday I had anticipated as a potential chop zone. It is always better to let the market decide where it wants to go, and then you can trade with the trend.
ES will need to reclaim and hold above 6355 for a continuation higher. 6360 would be a technical failure in the current (smaller time frame) short sequence. I am watching for reaction as we approach these levels
Holding above would open us up to upside targets of 6385 / 6404 / 6421*
on the flip side
Failure to do so, would target downside targets of 6324 / 6315 / 6290* / 6270*
*under extreme selling/buying pressure
Levels for today
»Line in the sand
6355
»Downside targets
6324 / 6315 / 6290* / 6270*
»Upside targets
6385 / 6404 / 6421*