Last weekend I put out this setup on $ES_F with a 4234 pivot and I specifically stated that any sells down into that 4187-4194 area would likely produce a bounce to target 4275. We did exactly that, with an initial sell and then a BTD back up to 4275+. See below:
We are now approaching major resistance (megaphone upper band and 61.8% fib level on SPY along with messy and strong dark pools at 428.33- 429.61 and we likely experience a sharp pullback soon.
It’s important in times like these to keep focused on the broader perspective. While it may seem “bullish” you need to keep in mind that we are just a typical downtrend, lower highs and lower lows. And, while we did put in a higher low technically, we have not yet put in a higher high in the bigger picture. See below the SPY 0.00%↑ weekly chart:
The past 12 months show a trading range between 360-430 and it is very premature to be calling this a new bull market. Although I’m hesitant to call this rangebound trading a “rally” this move has largely been caused by a “flight to safety” influx of funds into big tech. While some like $AAPL, $MSFT, $GOOGL, $NVDA, and others have had large rallies, the broader part of the indexes have not.
SPY 0.00%↑ has now filled the August selloff and closed above however it has left several unfilled gaps below at 422.92 and 396.49 which will eventually be filled.
We had some amazing calls in the discord this week and last week where we got several 1000% gainers since alert such as TSLA $180C JUN 16 which had an entry of 5.72 and TSLA $205C JUN 2 which had an entry of 1.56.
We continue to see some quality setups for the weeks and months to come which are shared with paid subscribers and in the discord. You can join the discord at (jmoptiontrading.com)
Here is the calendar for next week:
For this upcoming week I will be watching the following setups and levels:
SPY 0.00%↑
Continue to observe this large megaphone (daily) and bull channel (weekly) as it approaches major resistance at 428.33 (old DP level) and 429.61 (61.8 fib retracement). Due to how overextended it is and the significance of the 61.8% fib level - i will only consider SHORT bias for next week. If this LIS of 429.61 does not hold and bulls manage to close twice above it, we may be headed for 440-450+
429.61 Pivot & LIS
→ Below this we can start a pullback back to 422.99 (unfilled gap), 422.23 (breakout retest), 419.99, 417.81, 415.92, 414.05, 413.75
$ES_F
4309 Pivot / LIS
Levels below 4309 (61.8% fib retracement)
4304, 4294, 4282, 4275, 4256, 4240, 4234, 4221, 4211, 4205, 4194, 4188, 4175, 4167, 4153, 4137, 4124, 4110
QQQ 0.00%↑
RSI is overheated on all timeframes. Due for pullback. Heavy resistance in a fib cluster at 349.71-354.84. I cannot consider the long side here without a sharp pullback.
→ using 354.84 as a LIS, consider pullback to 343 to retest breakout. Below 343 can target 8ema at 337. Reminder there is a gap below left at 332.91
TSLA 0.00%↑
Big winner we called back at 165 to target 200+ and we did that and just hit $217 today. There is major resistance ahead at 221.26 and we are overextended currently. I think that on any pullback to 198.02, it may be supported for a move back to 221.26.
AAPL 0.00%↑
Important to look at bigger picture which is that it is technically in a weekly upside breakout. My opinion though is that this is a relatively low risk short (not 0dte) due to the valuation, overheated rsi, supporting orderflow and the fact that this upside breakout is on declining volume and low volume. Last week I alerted that over 175 we could hit 180-182.94 which we did this week.
182.94 LIS
→ Above this can target 188-190
→ Below this can retest wedge bottom at 168. Below this is a breakdown to 50sma 162.36
NVDA 0.00%↑
NVDA is stretched on all timeframes. It appears market wants it to hit the 1T valuation which is at 404. It is at very high risk of a significant pullback to 346. I cannot chase long here.
404 LIS
H&S setup below 404 to target 346.
GOOGL 0.00%↑
125.49 pivot - same applies for next week has not changed.
→ Below this RSI reset target 117.45-118.77. Below that target 113
→ Above this is a parabolic run to 136.95 which is a very risky chase, however we have now consolidated for a decent amount of time and it may move to this level along with AMZN if the $NQ continues.
AMZN 0.00%↑
We posted about the 135 ITM put writing months ago and that appears to be a potential magnet for AMZN.
Using 122.39 as a LIS on any pullback, we may continue into 135.04.
BA 0.00%↑
BA has been trading in a bull flag for the entire year of 2023. This one can make a nice move up into 240 and 275 if it clears 220.
Some stocks i’m interested in are the high yield dividends such as VZ 0.00%↑ & T 0.00%↑ which suffered huge pullbacks recently on AMZN rumors to sell cell service to prime members. These levels are equal to a 7-8% yield on dividends and there may be an overreaction currently.
I’m also looking at some REIT’s that are trading at 85% asset values and may be at a good discount along with a high dividend. I do not think market participants will continue to take as much risk as S&P crosses over 4300 for minimal upside when there are yields of over 6% in much safer places. AMT 0.00%↑ and CCI 0.00%↑ look interesting to me.
Have a wonderful weekend!
-Jovan