April 4th – “Retaliation Day”
Market Context & Game Plan Amid Global Tariff Fallout
What began as a shock on April 2nd has turned into a full-blown escalation. China's reciprocal tariffs and the EU’s retaliation threats have thrown markets into deeper turmoil. This isn’t just a sentiment-driven pullback anymore — it’s systemic pressure building across the global economic engine.
Market Snapshot
ES down -2.1%, breaking beneath 5300 to trade around 5286
NQ down -2.3%, pushing below 18,150
SPY -2.5%, QQQ -2.9%, IWM -3.8%
UVXY spikes +20.8% to 37.31
VIX surges to 40+, entering full panic mode
This isn’t controlled selling anymore. It’s emotional, aggressive, and headline-driven. The S4 level on ES (around 5374) is lost, and we’re hunting for a new structure.
Technical Market Context
ES 30-Min Chart shows clean breakdown candles with no real buyers stepping in.
Volume confirms conviction: we’re not bouncing, we’re unraveling.
5280–5260 is the last soft zone before a potential 5200 flush.
If UVXY breaches 40+, we’re likely in a full capitulation loop.
Scenarios to Watch
Bearish Breakdown Continuation
Global risk continues mounting with no policy clarity.
No bounce into open — ES could wash into 5200–5180 fast.
Watch for any bounce to reject around prior support at 5325–5340.
Relief Flush Scenario
Markets overreact early and find footing around 5260–5240.
If UVXY stalls and reverses, could lead to a dead cat bounce.
That bounce may only last until 5335–5350, unless macro clarity improves.
Trade Plan
Plan A: Wait for first 15–30 mins. No hero trades. Watch UVXY and volume.
Plan B: Look for reversal structure off 5260 with heavy confirmation (low probability).
Plan C: Breakdown setups below 5240 — short pops, scalp the trend with tight stops.
Plan D: Don't countertrend unless you’re seeing clear structure plus UVXY reversal.
Key Thought Today
We’re not just reacting to price — we’re reacting to global headlines. These ripple effects take time to price in fully. Don’t expect clarity. Expect volatility.
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Risk Disclaimer
Disclosure:
The information provided in this article is for educational purposes only and should not be considered as financial advice. Trading and investing in financial markets involve substantial risk, and it is important to conduct your own research and consult with a qualified financial professional before making any investment decisions. The author is not responsible for any financial losses or gains that may result from actions
Trading futures, stocks, and options involves significant risk and is not suitable for all investors. This content is for educational purposes only and does not constitute financial advice.