Market Plan for September 18th, 2023

Is it time to rebound?

Good evening folks,

Last Friday saw a bearish engulfing in SPX, with a dump of over 50 points. It’s not too out of the ordinary, since we get trend days like this 10-15% of the time. There are times when we rally 50 points as well.

We managed to capture a part of this move based on the plan we had prepared the previous day. I suspected we would finally break the similarities seen with price action from the August 21st to 28th period, which had been nearly identical to what we saw last week:

However, this might be where the similarities end. We have a few factors that are different now, mainly price structure. The long-term trendline is a major support/resistance level and has been well-respected for months. Along with this, we’re also hitting a major resistance area near the 4520s, which is where we stalled for a few days before we dropped heavily. This is a major supply zone.

Overnight, the market moved a little higher before hovering around 4510. At the open, we broke straight down from this level and quickly hit our targets.

Now that we’re at 4450, what’s next? Do we make new lows and hit 4400? Do we rally higher? Let’s make tomorrow’s plan to find out: