Markets Over Politics: Never Fight the Trend!

"In times of high volatility, let the trend be your anchor in the storm."

Hello, my friends!

Today’s markets gave us exactly what we crave - volatility with the perfect impulse hitting right on time!

VIX Signalling Fear

This was the kind of movement seasoned traders live for, and if you were prepared, the opportunities were spectacular.

Geopolitical tensions, major economic reports, and even surprise news can shake the markets, creating rapid price swings that skilled traders can leverage.

Instead of fearing the chaos, we embrace it, armed with strategies tailored for high volatility - and today was no exception.

We had a flurry of high-impact events to keep us on our toes:

  • JOLTS jobs and ISM manufacturing data

  • FED speakers emphasizing AI

  • Confirmed Iran air strikes on Israel.

Now, let’s dive into the major trend we experienced today and how the charts were prepared to keep us on the right side of the action.

Ready? Let’s break it down!

NY Impulse - SPX (1.31%)🗽📉

9:30-12:00 Est

Today, all eyes were locked on the major indices as the market navigated through a flood of critical events.

SPX providing the clearest path forward with key levels heavily in focus, especially with significant expirations on the line.

  • At the open, price was hovering above the massive gamma wall at 5750 - marking it as a level of extreme importance.

  • The market was teetering, and we knew if it couldn’t hold 5750, we’d see volatility explode to the downside.

    • And guess what? That’s exactly what happened!

  • While monitored the sell pressure, a broader narrative unfolded perfectly.

    • Geopolitical tensions escalated with breaking news from the Middle East conflict, fueling the bearish trend.

  • Even after the JOLTS and ISM data releases, which normally would cause market reversal, the market stayed locked on the geopolitical selloff, making that economic data almost irrelevant for the session.

  • Today’s major trend was confirmed when the VIX surged in tandem with Crude Oil prices, solidifying the downward momentum.

12:00- 2:00 Est

  • By lunchtime, SPX was deep into extreme territory, breaking below the 1-Day Min range - 5707.89 - calculated by MenthorQ.

  • This was a session where all signs pointed in one direction, and if you were tuned into the signals, you had the roadmap to profit from the volatile ride.

Today was the day when it was impossible to ignore the truth behind the famous saying:

"The trend is your friend!"

Live Economic News

  • "Iran prepping ballistic missile attack against Israel" - AXIOS.

  • US JOLTS Job Openings Actual 8.04M (Forecast 7.693M, Previous 7.673M, Revised 7.711M)

  • US ISM Manufacturing PMI Actual 47.2 (Forecast 47.5, Previous 47.2)

  • Fed's Cook: "There is evidence AI will allow more wage growth without inflation."

  • Israeli Military: Missiles were launched from Iran into Israel.

  • SPX 5750 (0DTE Highest Level of Put Gamma)

  • SPX 5725 (0DTE Positive/Negative Shift)

  • SPX 5707.89 (1 Day min - Extreme Range)

0DTE Levels: Zones of significant options volume in underlying assets, that can trigger an increase of volatility as the expiration approaches

These market levels are recalculated and updated daily, taking into account factors like gamma expiration, trading volume, and market volatility.

Coverage include Stocks, ETFs, Indices, Futures, and Crypto. For the most up-to-date levels and analysis, all information is available on MenthorQ.

Lessons from the Trenches 📚🧠

One of the biggest pitfalls that traders fall into - especially during volatile markets - is the temptation to fight the trend.

We’ve all been there, trying to predict that elusive market top or bottom, convinced we can outsmart the flow. But more often than not, this strategy leads to frustration and losses.

Here’s the hard truth: The trend is your friend, and during periods of high volatility, it’s your best friend. Instead of resisting the current, embrace the momentum and let the market guide your trades.

When a strong move begins to form - whether it’s on the way up or spiraling downward - your job is not to anticipate when it will turn, but to follow it until the market itself tells you it’s time to switch gears. The market isn’t a guessing game; it’s a flow of data, and that data reacts on the daily levels.

You’re not here to outsmart the market - you’re here to ride its wave. Volatility offer a simple yet powerful strategy that allows you to make informed, strategic decisions without getting caught up in the chaos of guessing when the tide will turn.

So next time you see a clear direction forming, don’t resist it. Embrace it - and let the market work in your favor.

Clarifying My Stance ✨

Let me be clear!

Geopolitical war is never something we hope for or favor from a peaceful perspective. Violence, conflict, and unrest are not things we support or wish to see, in any context. As traders, our focus is on the market reactions to these events, and the advice we provide is purely about identifying market opportunities that arise from such situations.

Let’s always remember: we’re here to respond to market shifts, not to promote or condone the events that cause them.

Until next time,
Steve B
Founder, The Daily Impulse

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Important Disclaimer:

This newsletter is for educational purposes only and does not offer financial or investment advice. It should not be taken as a recommendation to trade assets or make any financial decisions. Please be cautious and ensure you conduct thorough research or consult with a financial professional before making any investment choices.