The week started off on Monday with the market gapping down and printing red names across the board.
There are a number of stacked catalysts to watch out for this week.
The SPX index rollover continues this week. This is when big money sells and rolls into their further-out quarterly expiration contracts. So far, this has caused big moves to the downside.
We also have a large option expiration event called triple quad witching. Look for options to expire and for premiums to be affected by this.
As we head into a new quarter, we also have S&P rebalancing. This involves big funds and firms needing to rebalance their portfolios and follow rules that allow them a certain number of stocks and sectors.
To top it off, the Federal Open Market Committee (FOMC) statement addressing the interest rates decision will be released in the afternoon on Wednesday, June 15. This will be followed up with a statement by Federal Reserve Chairman Jerome Powell.
The S&P 500 (/ES) sold off at the end of last week to $3,900. This week started with a major gap down to the previous low of the year at $3,807.
Be mindful of the key zone from $3,807 to $3,855 as this will be our compass for the next market pop or drop.
Above this zone, the market could seek liquidity toward $3,900 to $3,930.
If the /ES doesn’t break above $3,807, we could see chop or a flush lower potentially to $3,656.
Here is our focused list:
NVDA — NVDA is trading near two major key levels at $155.67 and $152. If NVDA holds this $152 to $155 zone, focus on a pop above the trendline structure at $162. Through $162, look for NVDA to hit $167 and fill the gap to $168. If NVDA can’t break through $162, we could see chop or a drop toward the $155 to $152 zone. Below this, we’ll look for it to hit $148 to $142.
SHOP — SHOP is nearing major levels from $308 to $305. SHOP could pop from $305 to the $334 to $340 zone and fail. If SHOP can get through this zone, then $350 to $360 is possible. If SHOP fails to break through $322 and fails at $305, look for it to hit $282 and then potentially buy the dip.
AAPL — We’re using AAPL as a major compass for the market. If AAPL holds $132, it could fill the gap to $137. Through $137, we have $141 as the next target. If AAPL breaks $132, be aware of potential chop or a drop to $129.
ROKU — Employees started a rumor last week that Roku might join Netflix. On Monday, ROKU closed below the key level at $75. If ROKU breaks above $75, it could work its way toward $80 and then the $83 to $85 zone. If ROKU fails at $75, we could see a drop to $67.
Stay Focused!