Total And Complete Divergence
ES NQ PRE-MARKET TRADE PLAN 07/02/2025
Yesterday was one of those days you do not see very often. The ES and NQ were totally diverged from each other. The NQ had a legit trend day down where the ES was rotational. I got caught buying the dip on NQ which kept dipping and gave back a good day. The one good takeaway though is that it looks like both the ES and NQ are building in some structure here. We are seeing multi session balance which quite frankly is needed after the huge move up over the last month.
So I am looking for both the ES and NQ to hold these ranges, put in some balance and then ultimately make the move higher. Possibly on the passage of the Big Beautiful Bill or maybe just from the 4th of July holiday. Of course the markets can stay where they are and just balance some more till they are ready for the next move.
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So with the markets in balance I want to look to fade extremes till the extremes are broken.
See the below image for levels I am watching below…
For the ES see the levels I am watching below…
For the ES the red boxes above are areas of high negative delta at price. I want to watch the DOM in these areas to see if they adjust their positions.
Risk On Risk Off?
Kind of a mixed bag at the moment. Volume has gotten better into the cash open which has not been the case for many sessions now. VIX is up and equities are mixed. Yields are up.
Seems like a good day to sit on hands and let the market setup before a trade is taken.
Bish
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