Twitter Provides Masterclass in Social Arbitrage
Edge Levels (ESM4): 5100, 5125-5135, 5150-60, 5175, 5190, 5215-20, 5230, 5245, 5255
You can access the MGI document HERE for the latest Edge Levels and insights.
It’s National Take A Wild Guess Day, so please tell a trading friend about this newsletter if that’s how you feel when you’re filing your taxes.
So, how was your weekend?
It is with zero cheekiness1 that I say Twitter is an excellent contraindication of direction.
I spend a lot of time there.
Too much time, maybe.
Yet the platform does aid the P/L when viewed through the right lens.
Two of my most dogmatic trading opinions are:
The fundamentals of news have no reliable effect on intraday direction.
To quote Howard Marks, “Everything obvious is wrong.”
On Friday, I said I was looking for a Breakout (lower) from 5191.
I made the bet, and it worked out well.
This bearish assumption revolved around the textbook Acceptance of the key trendline from early April.
You can see this clearly if you look at the chart near the critical 5245 level.
Sellers absorbed a lot of demand overnight, and to me, this implied downside momentum.
We eventually closed below Four Sigma.
Five Trades for RTH 4/15/2024:
Backtest of Overnight High (short). Two stars This becomes three stars if Price provides an entry near 5230, which is today’s Four Sigma.
Reclaim of 5190 (long/short). One star. This level has been critical since last week, so I’ll view any directional speed and aggression around it as significant. Both sides of the trade are reasonable bets here. Yet I favor longs based on the potential developing Inverse Head and Shoulders.
Reclaim of ONL (long). Two stars. This drops down to one star if Volatility (VX24) starts ripping.
Reclaim of 5125-35 (long). Three stars. This opportunity occurs in a zone, so I’d scale into the position like I did Friday. It becomes two stars instead of three if Volatility (VX24) makes a new 2024 high. This zone is right below the Expected Move.
Reclaim of 5100 (long). Three stars. This is both a significant level and the downside Four Sigma today. There is about a 0 percent chance Price visits it today, yet I’ll be there buying until my mouse breaks if it does. This is the best risk: reward trade on the board today.
I hope to see you on the livestream trading floor.
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Stay classy until then.
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LEGEND’s word of the day. “It means boldly rude, impudent, or disrespectful in usually a playful or appealing way.”