Tickers discussed: SPY QQQ IWM FB AAPL AMZN GOOGL MSFT NFLX TSLA SMH WMT MT
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.
Earnings
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 1.25x to reduce run time.
Find the Video HERE
Upgrades and Downgrades
IWM is Rockin
IWM is dramatically outperforming peers SPY and QQQ. Why? Energy, Financials, cyclicals, and now Reddit meme names remain in favor while FATMAAN and other mega cap names remain largely range bound / dormant. Inside the video I show IWM breaking out of a nearly 5 month consolidation that is $17 wide. THis projects to a $247 target as long as Price can hold $230. That said, $230 needs to hold on any weakness. A move back below $230 would be pretty bearish as it would likely signal a fake breakout. Key off $230 going forward and stay long IWM as long as it holds.
Upcoming Catalysts
- Oil inventories today at 10.30am. Oil has popped $70. that is a big psychological level and opens the door to $75. My belief is that oil goes higher with a backdrop of muted supply response and increased demand fueled by re-opening. OPEC is in control on the supply side. Domestic supply should remain throttled by CapEx cuts and more difficult permitting environment.
- CPI print Tomorrow. LAst month the hot CPI roiled markets. This month most are expecting a hot number so I dont think the response will be as dramatic.
- FOMC next week. I expect a gentle drift higher into the FOMC. THen we’ll see what Powell has to say.
GOLD
- Gold has been stuck lately. The CPI print and FOMC statement should move the needle, but which way? THe chart remains constructive but price needs a catalyst.
- Here is the bull formula: Falling 10 year yields combined with a hot CPI print ( Falling REAL Yields ) combined with a falling $USD with a divish FOMC topper.
- Gold needs to take out $1922 on the /GC futures contract to open up more upside.
Reddit Meme Names
- GME / AMC / CLOV / WEN / BBIG / ROOT / WISH / CLVS / GOEV / AHT
- Not meant to be a complete list but a good places to look
Re-Posting – Thoughts on Trading the Meme Names
I’m not one to tell you not to gamble, but a few thoughts if you decide to jump in.
- Treat all trades like lottery tickets. Expect to lose it all. Dont use monies that if lost, will put your trading account or worse at risk.
- Watch overnight Risk. One in the hand is better than 2 in the bush. Don’t underestimate how deep or severe an overnight rug pull can be. Consider taking wins when you can.
- Market Makers are paid to Win. These guys are no dummies, They’ve jacked option IV to the moon making options incredibly expensive and thus harder to win. Make sure you know your risk / reward profile before to dive in. For instance, I priced some $25 strike PUTs in AMC a couple of months out. They were $25. So if AMC went to zero, I would get my money back. Not the kind of trade that makes sense.
- NEVER SELL NAKED CALLS or PUTS. While it may be super tempting to sell vol premium at the jacked levels, selling naked options exposes you to UNLIMITED RISK. If you sell anything, it must be a spread to limit / define your risk.
INDEX CHARTS
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 2 hour
SPY 30 min
QQQ 2 hour
QQQ 30 min
IWM 2 hour
$IWM 30 Min
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