Market Plan for September 14th, 2023

Things are heating up...

Good evening folks,

We had a violent, choppy reaction to CPI this morning. When the news first came out at 8:30, we immediately dropped 20 points form 4470 to 4450. Traditionally, the first move in CPI is wrong, and it was indeed the case this time.

We later rallied over 30 points from 4450 to 4483. This has been a key level for the whole week. After hitting 4483, we ranged around there for a while before dropping back down to 4462, another key level. In yesterday’s newsletter, here’s what I wrote about today’s move:

This pattern feels like a repeat of August 21st-28th, but smaller. In August, we had a large 3-day decline before we bounced, after which we had a large bear day. It was also the day before a big event, Jackson Hole. All of this parallels with the current chart pattern. If this pattern were to continue, it means we’d have a large drop tomorrow followed by a large rally.

This is exactly what happened as we reacted to CPI. We had a large drop followed by a large rally. We’re now in a symmetrical triangle-type pattern. This pattern usually precedes intense volatility. Will we rally upward or drop lower? Let’s find out in tomorrow’s plan: