SPY: Week of Sept 5th

Just going to get this posted now.

So, I took a look at everything, basically most of what we need to know is in this chart. Obviously, we will need to see how ES1! and SPY treat the threshold values for next week, but for the most part the pivotal information we need to know is posted here.

So let's break it down, because there is a lot.

The Chart:

• We have a slightly bearish reference target at 450.25 .
  
  
• The forecasted lows correspond with our previous demand zone. However, really we have created a new demand zone by the resumption of our uptrend (shown below):
  
  
  
  
• Our previous month baseline sits at 445.13. This is extremely important to pay attention to. Why? Well, if we are going to trend in the upward direction, we technically should not break below this level. We can re-test this level, that is fine, but it really shouldn't break it. We can see why when we look at how SPY treats previous month baselines during strong uptrends:
  
  
  
  
  We start running into trouble when we break these baseline averages, like we did last month.
  
  
• I have plotted out a time series model that encompasses our October low (visually represented below):
  
  
  
  
  Based on that, by Friday of next week, our range should be between 459.96 and 439.98 (represented by that white box). Our forecasted targets and supply and demand zones seem pretty confined within this box as well.
  
  

The Probabilities for Next Week:

Probability on the Weekly

Per ush, quite mixed and with some suspicion of impending bullish whipsaw. But in general, there is a favouring pf some pullback across the board on ES1!, SPX and SPY when we look at the momentum and rate of change probabilities.

You can see, in general, there is a slight favouring of our real time low targets next week. Which makes me think we will see pullback (there are other reasons which I will get into later).
The range analysis also does seem to favour more of a move to the downside, in general, based on technical probability but more of a move to the upside based on ROC.

If we look at SPX:

Probabilities on the Daily

Going into Monday (Labour day), futures will trade on condensed hours. The probability is showing a favouring of some downside continuation.

Going into Tuesday, probabilities are pretty convincing for some bullishness, more pronounced on tech than on SPY.

The VIX

I want to make mention of the VIX because the VIX had a very interesting close this week.

VIX closed below -2 SD's on the weekly. This happens infrequently and the few times it has happened have lead to a bit of a rebound pop:

Instance #1:

Instance #2:

Instance #3:

This merits extreme caution with longs, imo.

Verdict on SPY:

• Your bias should be neutral here. There are a lot of reasons to be bearish, at least for pullback.
  
  
• That said, obviously momentum is bullish. I suspect dip buying will still be in play and I don't really foresee this catastrophically failing, but it is possible. At the very least, my view is that SPY will attempt to gap fill on the daily up to that 454/456 area. Greed remains the primary driver of this PA and I don't think its ready to go kaput yet.
  
  
• Really watch what happens with that baseline average. If we pullback to it and bounce, maintaining above it, we are very much trending up. If we start playing peak-a-boo with it, its not a great sign and not a great look. If we avoid it all-together, then the sentiment remains overwhemingly bullish. For me, personally, as of right now, this baseline average is THE MOST pivotal line to watch, and you can see why when you look at that chart I posted above. Remember from last month, when we break below it, we generally pull back, on average, 2% from the baseline.
  
  

That's it for now. Will catch up with you on Monday but will also post some other ideas on other tickers likely over the weekend.

Leave your comments and questions below!

Safe trades everyone and happy Labour Day!

評論:

Now that futures has closed on their condensed day, we have slightly more information.

The close today shifted the probs slightly to more of a bearish favouring going into tomorrow.

ES1! stayed confined in its weekly threshold, which is what I suspected it would do:

However, NQ1! did get a little over-zealous and jump out slightly, but closed back in:

Looking at the implied move from options, SPY is pretty neutral but QQQ seems to have a bigger move priced in to the downside:

And the last thing, if we look at QQQ on the daily with my predictive pivot points over-layed:

We will see how we open tomorrow but just some food for thought!

評論:

I have not much to say about today. It was a mess.

But after my little BA lotto I thought I would just go ahead and try that again, this time with NVDA:

Bought some calls and 1 put at the math high targets, total cost of entry was around 150 (really OTM, the strike price was the projected high and low targets).

I will make more if this hits the high targets, but will make money as long as it hits a target (whether it be the highs or lows). Which is a big if owning to the whole condensed week sitch. Its very possible NVDA just doesn't do anything and I lose completely.

Why I am more long biased here are some unrealized bullish 99s in the tech sector ;).

This is not a good trade, not like BA which had a bullish 99 directly on the ticker. NVDA has no bullish 99s. I am basing this on a generalization of tech (and NVDA tends to do its own thing) and on the fact that NVDA and QQQ broke the bull threshold on the week. Also, just on the general fact that we are in a bull market and that everyone consistently keeps calling tops on NVDA. As long as people keep calling tops, it will probably continue to go higher haha.

In terms of what to expect tomorrow, its pretty 50/50. Things are coming up mostly bullish though (SPY and Tech). Tech is a bit more 50/50 than SPY.

Remember to watch those levels, so 445 which is our previous month baseline and 449 to 450 which is our weekly threshold and monthly threshold. SPY did close below the bear threshold on the week, but you know it likes to play its games. Before getting too bearish I would look for it to hold this level:

If we open below it tomorrow and can't reclaim it, then yeah sentiment would be more on the bearish side than the bullish.

Trade cautiously everyone, very much a headache start to the week, IMO.

評論:

Hey everyone,

Hope you all had a great trading day, though this PA is pretty dreadful and terrible.
Its incredibly difficult to trade so if you are having trouble, please don't feel bad about it. its actually some of the worst I have traded in a while.

For tomorrow, our favoured target is 448:

The most interesting chart right now is DIA:

And you see we have an outstanding high prob target (83%) on DIA for the week at 350.

Will leave it at that, leave your comments and questions below!

評論:

Yikes,

Not a great day thus far. I have been very disorganized and not on my A game this week, lots going on and I apologize. I didn't realize we actually didn't finish the move yesterday to PL2 on the weekly despite having satisfied the conditions:

You see we just missed it. Had I noticed, I would have said this needs to complete the move down before it can bounce. We completed it with the gap down and did indeed get a bounce.

So yeah, my bad, I missed that. This really hasn't been my best week, I have been really all over the place haha, its not even funny but it kind of is.

So let's just not overcomplicate things. Here is where we are:

We took out the forecasted low targets (that red box) and have broke below the baseline. We have had multiple rejections on the baseline today, though it does seem like it really is trying to reclaim it.

We also have broken and are holding below the monthly bear threshold:

In fact we actually took out the first monthly low target. So what this means is our expected move right now is the second monthly low target. This is 436.
Ironically 436 is about 2.05% below our baseline. This would satisfy the 2 - 3% pullback rule on a break and hold below the baseline.

Still kind of early, it does seem to want to break the baseline but unless we can close over it today, the clock starts ticking.

I will check back after market closes to see what was the end result. For you longer term, swing traders, failing to reclaim the baseline today is actually not a terrible spot to start scaling into a short position to the second monthly low target. You can keep your stop really tight at the baseline break and its actually a great r:r here.

But I will check back in a bit and see how things are looking going into tomorrow.

Again, sorry for being so aloof this week, what a mess!

評論:

That baseline is like a F***ING MAGNET, haha irritating kind of:

評論:

And our close:

Nice close below the baseline!
It did try very hard, but couldn't quite get there.

So like I said, the expected target, assuming we remain below this baseline, is 436. If we do reclaim the baseline tomorrow, the next math area of resistance is our bear threshold around 449. I would look for rejection there.

Its important to note that we hit the first low target on the month. This does slightly tilt the odds away from any dramatic move up, but not all that much. Just something to keep in mind at this point.

The target I am looking at for tomorrow is 442. If we can remain below baseline into tomorrow and not break over it, I will be swinging SPY short.

Safe trades everyone!