Month: July 2021

 

With the market finally giving us a much needed pullback, it’s time to step back and analyze our next opportunities! We’ve been waiting for this to happen for a while now, so let’s take a look at where the markets are now. 

We’ve seen the markets rally higher every time prices hit the daily Ichimoku Cloud, and now we have finally seen them gap down. The question is, how low will they drop? The major indices can be used as a compass to determine direction, looking at the S&P 500 (ES), Dow Jones Industrial Average (YM), and the Nasdaq Composite (NQ). The YM continues to drag the markets down as the lagging sector, and investors shifted their focus on the NQ. 

We can use the intraday and 4 hour clouds as a guide to see if prices will continue to move lower or if we continue to the mean. We can use Keltner channels as well in order to establish when we should buy the dip. Now that the markets popped and reset, it’s a patience game to see where we will go next. Focus on the key zone around Tuesday and Wednesday’s lows for a sign to rise to an all time high or revert back down to the daily mean.

Keep a tight focus on VIX, ROKU, NVDA, SHOP, SNOW, and AMZN. Check out the video above for a more detailed view of the markets.

Stay Focused!

 

 

The market is very strong right now, but we don’t know where things may go from here. We recommend sizing down in order to protect ourselves a bit as we are at some very extended levels. The Ichimoku Cloud and average true range (ATR) will continue to be great indicators to watch as you plan for the week ahead.

Here is our focused list:

FB – Watching to see if it will squeeze under all-time high (ATH) for a breakout toward 360+

GOOGL – Firing daily squeeze and 4-hour squeeze. It has accomplished its mission of hitting 2500 and could continue towards 2550

ROKU – Stalking a pullback and seeing if it will base towards 420. It could potentially work its way back to 463

SHOP – Watching daily wedge and 4-hour Cloud for a push back towards ATH

Stay Focused!

 

 

With technology being the clear leader in this market, and quarterly earnings just a few weeks away, it’s time to look for high-probability setups in the leading names. We want to focus on names that are trading near the buy zone, as opposed to extended at 2-3+ average true range (ATR) levels.

One of the names we are choosing to place extra focus on is AMZN. This is showing a beautiful weekly squeeze along with a series of lower time frames setting up on a key level of support. We are looking to place a trade for a move into brand new all-time highs over the next three to four weeks.

Last quarter this same setup in AMZN resulted in our biggest trade of the year, so we’re hoping it performs in a similar fashion this time around. Watch the video below for other tickers where we can make moves.

Stay Focused!

 

The bulls continued to punish the shorts this week, as both the Invesco Trust Series 1 (QQQ) and the SPDR S&P 500 ETF Trust (SPY) rallied into brand new all-time highs (ATH). Though it’s difficult to tell by looking at a chart of the SPY (below), this is not a “market-wide rally.” All of this momentum is being driven by the strength in technology and semiconductor stocks, and that’s where our focus will be to the upside over the next few weeks.

 

 

The most important thing to take into consideration right now is that the indexes (see NDX below) are very much extended, as are leading names like GOOGL, NVDA, MSFT, and many others. Without a doubt, technology is where the leadership is right now, but with the index so extended we need to position size appropriately. We save our big positions (10% risk) for when the indexes are setting up at the 21 exponential moving average (EMA) and we scale down in size once the indexes are at the 2-3+ average true range (ATR) extensions. By making this slight adjustment, should the markets dip before the next leg higher, we won’t take too much damage.

 

 

This week, we took advantage of hourly squeezes in both TSLA and GOOGL (see below) that led to some great trades in the options room. Our TSLA put credit spread was bought back this morning for 75-80% of max profit and the GOOGL calls we bought at the open served us incredibly well. Simple setups, simple execution, and we are ready for the next one.

 

 

Over the next few weeks, we will have a big focus on AMZN (chart below) as it approaches earnings. Very much like last quarter, the stock has fired a daily squeeze, pulled back to the 8 EMA, and is now resting on the moving average with a handful of lower time frame squeezes setting up. This setup, and the push into earnings, was our biggest trade of the year last quarter. In this Sunday’s prep video, we’ll cover how we’re looking to trade it this time around.

 

We hope you enjoy the long weekend, spend some time with family, and are well-rested for next week!

Stay Focused!

 

 

The market this week has been bullish and extended which makes for some fun trading. We’ll continue to drive the following point home: the daily Ichimoku Cloud has and will likely continue to be a great compass for buying dips as the overall market, or E-mini Futures (ES), continues to reach new all-time highs after bouncing off the Cloud.

Keltner Channels are another good indicator to keep an eye on at the moment, especially the 2+ average true range (ATR) lines, since they seem to be working as a limit for the market. This means that as we near the 2+ ATR line we need to start playing a bit more defensively. Watch the video below to see how we can use the hourly and 4-hour Clouds as gauges for market moves and also how the Non-farm Payroll (NFP) job report may affect things tomorrow.

Stay Focused!