Week of November 6th 2023

300points on SPX in 5 days, pullback time?

Hi everyone!

This past week we saw an incredible 300pt rally in SPX and closing the week near the highs. While we did anticipate a rally & squeeze, this one went well above my expectations. Last week we noticed the shift in AAII numbers with bearish sentiment increasing near the lows and suspected there was an “imminent squeeze.”

I mentioned that bulls needed to “take back a major resistance, now 4180-4200 to get a relief rally going back into 4240 and 4269.” We gapped up to start the week and cleared this 4180-4200 zone when we gapped up on Wednesday leading to a massive squeeze and consecutive gap ups on SPX all the way to 4373.

You can see here the price action and how 4180-4200 being reclaimed by the bulls led to the large squeeze:

The range for last week was 4132-4373.

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SPX Analysis:

Key Levels: 4248 & 4400
Bulls have reclaimed control temporarily and dips may be bought as long as SPX is above 4248. Multiple gaps have been left below and bulls have the task of setting a higher low.

Bullish Trajectory: Bulls need to hold 4248 (preferable 4282) on any dips to keep rally going into 4400. If they can clear 4400 the next target is 4472.

Bear Trajectory: Bears have alot of work to do and there is no bear case above 4248. Supports below current prices are 4331, 4308, 4282, 4248 ,4214. There are two open gaps below at 4319 & 4245. For bears to reclaim control they will need to fill both gaps and take us below 4245 for a retest of 4214, 4172, 4155, 4103.

Summary:
Probably a dip next week into 4282, as long as it holds there, rally likely continues into 4400.
Below 4245 there is possibility of lows being retested and lower to 4035

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For those of you not in the Discord (www.jr88trading.com) I highly encourage it as we cover a lot of the setups given here but we also alert LIVE trade ENTRIES and EXITS.

Some calls from last week:
TSLA - hit our 226 target from 200-205 entry area.
SPY $420C NOV 3 was alerted at 1.40, they went well over 16
QQQ - exceeded our 357 target from our 349 trigger level.
AMZN - we gave a long signal over 124 towards 135 and this went over 138
GOOGL - we gave a long signal at 120-121 for a move back to 131, we hit 129
META - hit our 316 target from our 303 trigger level.
TLT & GDX from the watchlist hit their respective targets as well.
ROKU - we added it to our watchlist last week for ER and advised over 56 could see a return to 69. This target was exceeded as well to over 85+

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Last week I pointed out a major red flag on AAII for me as there was increasing bearishness on a decline which is implying that retail is assuming we can’t go lower. This was before even reaching “extreme fear.” Now we are almost back at neutral, and we saw peak bearishness this week despite a massive rally.

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Here is the economic calendar for next week:

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For this upcoming week I will be watching the following setups and levels:

SPY 0.00%↑
Failed to take out the prior high 438.14
Watching to see if it makes an attempt next week as it fills out this megaphone

I favor dip to 427-428 to reset overbought conditions and build a base for strength into 444

If there is a volatility event and 428 level falls, watch for 423 and 420 levels. Below that I would not buy dips.

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AAPL 0.00%↑
Noticed call flow for 177.5C next week.
We closed right below 50dsma.

Longs: Watching 178.77 level. If we build support over that then can take a long to 182-184 area.

Shorts: No shorts for me unless under 170-171.68 at which point I would short to retest the lows around 165.

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NVDA 0.00%↑
Noticed 450C and 460C flow which lines up with the top of the pennant

Can try a long if we build support over 450 to target 460
Can try a short if 442 breaks to retrace to 429.22-432.

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