Before the Bell Feb 7

Did I help you profit?

Please consider making a modest donation to help me continue producing valuable content.


Before the Bell  is premarket prep for active traders. The note provides detailed stock market technical analysis focused on the indexes and FAAMGs. Key levels and trading locations are provided, along with trading plans and timely commentary to keep you on the right side of the trade.

Inspiration – Market Wisdom from 1912

THe demons and pitfalls of traders 110 years ago are the same ones that torpedo us today. Item #1 is correctly placed. If you are not able to calm your mind and keep well – centered, you may want to consider a new profession. Without it, making progress on all the other things will be pretty difficult.



Companion Video  

The video is a detailed technical review of the indexes and FATMAAN names. All the key trading levels are identified along with commentary and trade plans for each ticker. Trade ideas are also discussed.  Run the video at  1.5x to maximize efficiency without loss of clarity.

Find the Companion Video HERE  

Macro Data Releases Week of Feb 7

  • Monday – Nothing of Consequence
  • Tuesday – NFIB Small Business Optimism Index; International Trade; Redbook;
  • Wednesday – Mortgage Applications; wholesale inventories prelim; Oil inventories; 2 FOMC speakers; 10yr Note Auction
  • Thursday –  CPI; Jobless Claims; NatGas Inv.;  30 yr bond auction 1pm
  • Friday – Consumer Sentiment

Dead Cat Bounce ?

While there is room for this rally to make another push higher, I am leaning slightly bearish. All of the weekly trend lines have broken on the indexes and thus technical damage has been done. THis puts things in a bearish technical posture. Also, notice the relative performance of the defensive sectors are on the upswing. Lastly speculative areas of the market like the ARK complex are still very weak. Watch them for signs of animal spirits. I think they are a great gauge of sentiment.

$SPX Trend Break – Intermediate Bearish Posture

Noting this weekly trend break is important. It puts the $SPX in a bearish intermediate posture. While price remains below trend, the bounce remains suspect, but if price were to recapture the trend it would put the market on a much more solid technical footing for the bulls. As we’ve noted many times in recent weeks the 4500 level ( $450 on SPY ) is also an important level. It is the low side of a $20 wide consolidation trading range between $470 – $450.  It isnt a coincidence that price stopped on a dime once it hit that level in Friday’s rally.

Key Option Strikes

Market Insights

It is far better to consistently have small, positive gains vs bigger gains but with big draw downs.  Its the Tortoise vs the Hare.  We are entering a new regime in markets as JPOW opens the drain on the liquidity pool.

Successful trading going forward will rely on these factors:

  • Flexibility ( Leaf on a Stream )
    • Be open to both bull and bear outcomes with lots of whipsaws in between
    • Strive to show no bias for a bullish or bearish markets; money can be made in both.
  • Comfort with 2-way trading
    • We’re entering the Golden Age of Long / Short Trading
    • If you’re not comfortable shorting or buying PUTS, time to start learning or know when to step aside.
  • Comfort with Higher – Vol Environments
    • In a whipsaw or bearish environment, Volatility will increase
    • Higher Vol often leads to PnL Whipsaws that can crush positive trading psychology
    • Trade smaller during these periods
  • Comfort with New Asset Classes
    • You ok being long Coffee, Cotton, Uranium, Copper etc?
    • Cramer is right, there’s always a bull market somewhere.  But if you’re not familiar or not willing to go there, you wont be able to participate.
    • Not a prediction, but are you OK with FATMAAN going fallow for 3 years?
      • Formulate strategies that dont include the old gravy train stocks everyone is used to simply holding forever.
      • Recognize if / when those stalwarts are no longer working and trade something else.


ESG – Energy Stops Growing.

No Supply Response:  2022 is set up to be a lost year in terms of hoping for or expecting a supply response from producers.  If a well was literally started today, oil would not hit the market until very late in 2022 or more likely in early 2023. Demand continues to move higher as the post-covid world moves toward normalization.


A detailed walk-through of the levels and trading strategy for the indexes is given in the video ( link above) . The static charts are provided for reference. The FATMAAN names are also reviewed in the video along with trade ideas and other charts of interest.

SPY Daily

SPY 2 hour

SPY 30 min

QQQ Daily


QQQ 2 hour

QQQ 30 min

IWM Daily

IWM 2 hour

$203 proved to be a problem as price was unable to take it out and now has reversed lower.

IWM 30 min

Get inspired, empowered and prepared!!

Join us!

As the host of Trader’s Profit Compass, I work hard to inspire, empower, and prepare aspiring traders to face the markets with fortitude, quiet confidence and inner calm. It’s a protein-rich, sugar free environment without ego or judgement. While I can’t promise that joining our group will change your life, I’d like to think it will help your trading. Give it a spin!  Nothing to lose and potentially much to gain.

Our group of aspiring traders are into active swing trading using technical analysis to find objective, high-probability,  low-risk trades.  Using these processes we’ve been fortunate to be winning; not perfect but winning. If that is appealing to you, join us!  I’d like to think you’d benefit from the work.  You’ll get premium  content 6 times a week including a copy of my Daily Profit Compass, Weekend Profit Navigator, along with other actionable content delivered directly to your mailbox. You’ll even get an invite to our new trading room on SLACK.

Registration is simple and FREE   Visit our homepage  HERE

Spread the word?


Leave a Reply

Your email address will not be published. Required fields are marked *