Let’s discuss a few catalysts this week, including the FOMC event and earnings, along with some key setups we’re watching. This extended market gained strength on Wednesday, with the S&P 500 (ES) hitting another all-time high. This is a great reminder to be patient and react to the market. Watch the video for analysis on the major indices, volatility, and setups we’re keep an eye on like GOOGL, ROKU, and MRNA.
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In an extended market, quicker trades taken off of lower time frame squeezes are a great way to “milk the momentum”, without taking unnecessary risks. Let’s take a look at a few setups in $GOOGL, $GS, and more.
The market is continuing its march higher and isn’t showing signs of slowing down.
Technology is the strongest sector leading the market, driving the bulls higher. With the bulls in control, the market is reaching a point of being extended.
The S&P 500 (ES) is hitting 3+ average true range (ATR) from the daily mean for the second time this year, the first being in April.
While we want to use our technicals to help capture the probability of moves, we should not rely solely on the theoretical. Although extended, the market could keep grinding higher and there isn’t any promise for a pullback.
Remember our “if this, then that” rule? Rather than having a strong bias, listen and react to triggers in the market to determine its next move.
If the ES breaks $4,650 we could use this as a trigger to see it drop to $4,627 and potentially down to point of control (POC) at $4,620. Vice versa, if the ES breaches $4,674, it could run to the psychological level of $4,700.
Watch the video above for more trigger points and key setups like ABNB, QCOM, and GOOGL that we’ll be watching in the market.
Stay Focused!
We have an eventful week to start November with earnings releases and economic events that could lead to potential spikes in volatility.
After big technology earnings last week, we’ll be shifting our focus to earnings from ROKU on Wednesday after the close, MRNA at the open on Thursday, and more names like SQ, ABNB, and COIN at the end of the week.
Practice patience around earnings and focus on playing the premium crush and market reaction after earnings are released.
Regarding the economic calendar, keep an eye on the ADP employment report on Wednesday and the FOMC statement followed by Federal Reserve Chairman Jerome Powell speaking at 2:30 p.m. Eastern that same day. Another potential market-moving catalyst is the nonfarm payroll report on Friday.
These economic events are often strong chances for volatility.
Here is our focused list:
UPST — Last week a wedge began setting up with a 2-hour squeeze. UPST pushed to the key level at $346.54 and closed underneath it on Monday. We are looking for a continued zone-to-zone. Let’s see if the wedge and squeeze will continue to fire and UPST pushes to the $357 to $363 area at point of control (POC).
SHOP — After a strong breakout last week SHOP continued to rally on Monday. Now we are approaching tougher territory, where it could reach $1,600 but it might be a hard journey to get there. Watch to see if SHOP can hold $1,506, break $1,540, and then reach $1,588.
NVDA — After a strong run to all-time highs, we’re looking to short NVDA. It finished near its all-time high at $259 on Monday. We would love to short at this high down to last month’s POC at $247. Use the 3-minute Ichimoku Cloud as an additional guide to indicate if NVDA will drop lower.
I look forward to seeing those of you who signed up for the Max-Out Your Trade strategy class with pro and elite live-trading sessions the next two weeks. If you want to follow this strategy in real-time with me, register for the class here.
Stay Focused!