Weekly Forecast - January 4th, 2026

Summary

In this first weekly outlook of 2026, the trader discusses a neutral market bias for the week due to ongoing consolidation in NASDAQ and S&P 500. The trader highlights key price levels and liquidity zones, emphasizing the importance of patience and discipline in uncertain market conditions. With global news influencing price action, the outlook stresses the need for a structured approach to trading, focusing on waiting for clear setups rather than forcing trades. The trader encourages viewers to stick to their trading systems, even if losses occur, as long as the process remains disciplined.

Takeaways

• 😀 The first weekly outlook of 2026 is neutral, as the market remains in consolidation, moving up and down without a clear trend.
• 😀 Patience is key when trading in consolidation, as markets can stay in ranges longer than expected, requiring careful monitoring and rule-following.
• 😀 The focus is on the NASDAQ chart, analyzing the weekly, daily, and 4-hour timeframes to understand price action and key levels.
• 😀 Price is currently in a range between December's high and low, with a focus on discount and premium levels within the range.
• 😀 The key is to avoid overcomplicating analysis with excessive levels and focus on the most significant factors that affect market direction.
• 😀 The dollar is also showing a neutral bias, with no clear direction after sweeping external buy and sell-side liquidity.
• 😀 The market has been consolidating, and it's important to wait for more information and structure to form before making bold moves.
• 😀 External events, like global news, could cause significant gaps at the market's open, requiring traders to adjust their strategy accordingly.
• 😀 The S&P 500 shows similar consolidation, and there's a key focus on price action near important liquidity levels like fair value gaps and session lows.
• 😀 While the week starts with uncertainty, traders should remain disciplined and focus on clear setups that align with their trading model, even in a neutral market.
• 😀 Losses are part of the trading process, and it's important to stay objective, review trades, and avoid emotional decisions or revenge trading.

Q & A

What is the primary sentiment the speaker has for the market at the start of the week?

The speaker expresses a neutral bias at the start of the week, indicating that the market is in a consolidation phase with no clear direction. They anticipate more information and structure will emerge as the week progresses.

How does the speaker typically approach trading when the market is in consolidation?

The speaker advises patience when the market is consolidating. They suggest focusing on clear factors like liquidity pools and key price levels rather than overanalyzing every small price movement. This helps avoid analysis paralysis.

What are the key levels the speaker is monitoring for NASDAQ this week?

The key levels the speaker is monitoring for NASDAQ are the December high (buy-side liquidity pool) and the December low. They also note that price is currently at equilibrium within this range.

What is the speaker’s stance on trading in the current market conditions?

The speaker emphasizes being cautious and not forcing trades during unclear market conditions. They suggest only trading when a clear setup presents itself, even if the overall market bias is neutral.

What does the speaker consider a key indicator for setting up a trade?

The speaker emphasizes following a structured trading model with clear entry criteria. They stress that even in neutral market conditions, it's important to adhere to a trading plan and avoid emotional decision-making.

Why does the speaker mention 'liquidity pools' in their analysis?

Liquidity pools are mentioned because they help identify key price levels where the market might react. These areas, such as buy and sell-side liquidity pools, act as targets for potential price movement or reversals.

How does the speaker use the opening gap to inform their trading decisions?

The speaker uses the opening gap to assess market sentiment and potential price movement. They observe whether the market gaps up or down, as this can provide insight into how the week might develop and help form a trading strategy.

What is the significance of the 'Friday low' mentioned in the analysis?

The 'Friday low' is significant because it represents a key level that the speaker is watching. If the price goes down and tests or sweeps this low, the speaker will look for a market reaction as a potential trading opportunity.

What is the importance of 'fair value gaps' in the speaker's analysis?

Fair value gaps are important because they represent price zones where the market has moved quickly, potentially leaving an imbalance. The speaker looks for these gaps as potential targets for price movement or reversals.

What mindset does the speaker encourage for traders, especially after a loss?

The speaker encourages traders to adopt a disciplined and objective mindset. They highlight the importance of following the trading system, even in the face of losses, and not deviating from established rules. This helps maintain consistent performance and avoid emotional trading.