SPY-Triple bottom bounce, but L.T. Bear thesis still strong
Updated
SPYI've been short SPY since 10/27. (I actually jumped in a little early on 8/25) The majority of my success (profits) has come by selling calls. I started selling bear call spreads 11/2 and opened additional positions 11/23 & 12/29. I've already taken the profits from most of my positions. The only position still open is 2 bear call spreads set to expire 2/19 where i am short at $211.
The Daily and Weekly chart shows a triple bottom forming. The pin bar off of ~181 support zone indicates potential for a decent retracement. We could have a move to $200 or more. I big retracement = additional opportunities to go short.
I don't see any compelling evidence to change my bear bias. A move to $215 would be a compelling reason to reevaluate. At the same time, I am not very excited to go short at the current level. I'll wait for a better entry point. It could happen next week.
Note
I was hoping for a larger correction this week, but instead SPY has had an uneventful week. With an initial bounce much more subdue than the last 2 previous support rejections, the Bulls must be losing conviction.In it's current consolidation range and with strong support 182-180, I'll continue to wait for a better opportunity to short. Risk/reward is not great for either longs or shorts.
Next week SPY could:
1. Continue to stay in current consolidation range
2. Retest support zone
3. Continue correction (climb closer to $200)
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.