📈 Morning Update for Subscribers
CPI Shock – Market Reacts with Heavy Selling
📈 Morning Update for Subscribers
CPI Shock – Market Reacts with Heavy Selling
🔍 Market Overview & Key Levels
🔸 $ES Open Pivot: 6060
🔸 $NQ Open Pivot: 21682
We were spot on to be bearish at 6095 ($ES) and 21800 ($NQ)—the CPI report delivered exactly what we expected: a sharp downside reaction. $NQ plunged 300+ points, while $ES was slammed off 6095.
Now, the key question is whether this sell-off extends lower or if buyers can trap bears and reclaim lost ground.
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📉 Key Levels to Watch
🔻 Bearish Control Zone – Sellers Must Hold Below
🔹 6040 ($ES) – Major Support Test
A break below 6040 keeps selling pressure intact.
If sellers hold below this level, further downside to 6015 and lower is in play.
🔹 6025 ($ES) – Bear Trap Risk
If the market fails to break lower from here, it could snap back hard in a bear trap.
Reclaiming 6040 would send price right back to 6095.
🔹 6015 ($ES) – The Big Level
If 6015 fails to bring in buyers, we could see an extended liquidation event.
Next support targets: 6000 → 5965 → 5935.
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🚀 Bullish Scenario – Can Buyers Reclaim Lost Ground?
🔹 Reclaiming 6040 would shift momentum.
🔹 If price pushes above 6060 (open pivot), the retrace target is 6095.
🎯 Upside Levels if Buyers Trap Shorts:
6060 ($ES) → Reclaim open pivot
6095 ($ES) → Key resistance & breakout level
6107+ ($ES) → Bulls must secure a close above for full control
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📚 Market Education: Understanding CPI Reactions & Avoiding Traps
📌 What is CPI & Why Does It Matter?
The Consumer Price Index (CPI) measures inflation, and inflation data directly impacts Federal Reserve policy.
Higher than expected CPI = More inflation concerns = Fed stays hawkish → Stocks sell off
Lower than expected CPI = Less inflation concerns = Fed eases → Stocks rally
📌 How Markets React to CPI Releases
1️⃣ Initial Volatility – The “Knee Jerk” Move
The first move after CPI is often a fakeout.
Algorithms react instantly, but smart money waits for confirmation.
2️⃣ The Real Move – Confirmation After the First 30 Minutes
If the first move extends without retracement, it’s likely real.
If price reverses back to pre-CPI levels, the initial move was a trap.
3️⃣ How to Avoid CPI Traps
✅ Wait for the first 5-10 minute candle to close.
✅ Look for confirmation on key levels before entering trades.
✅ If price reclaims pre-CPI levels, the move was likely a liquidity grab.
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🔎 Trading Scenarios for Today
📍 Scenario 1: Continued Downside (Bearish Control)
If 6040 fails, expect further selling to 6015.
A break below 6015 could trigger full liquidation.
Target: 6000 → 5965 → 5935.
📍 Scenario 2: Bear Trap & Rebound
If 6025 holds and price reclaims 6040, expect a violent short squeeze.
Target: 6060 → 6095 → 6107.
📍 Scenario 3: Chop & Indecision Day
If price bases between 6040-6060, we may see a grind session.
Key: Wait for a breakout above 6060 or a breakdown below 6025 before committing to a trade.
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📌 Final Thoughts – CPI Days Require Patience
✔ Sellers are in control under 6040.
✔ If 6015 fails, expect deep downside moves.
✔ Buyers must reclaim 6040+ to start a reversal.
🚨 Key Takeaways:
🔹 CPI moves are often fakeouts – wait for confirmation!
🔹 The real move usually happens 30+ minutes after the release.
🔹 6015 is the critical downside level to watch.
👀 Stay disciplined, trade with confirmation, and don’t chase the first move!