SpySo.... I'm looking for a rebound this week early on from Smallcaps, banks, and cyclical. All last week everything non tech sold off.. it all started with TVC:NYA hitting this monthly trendline
As you can see, this has been resistance for about 5yrs and every time it has tagged , a correction has followed. To make matters worse , July monthly candle finished with a gravestone doji reversal. Monthly grave stone reversal means that the trend has likely flipped and for the next few months at least until Oct things will flip bearish for all things non tech.
but right now for this week, I think all things non tech gets a big bounce at least early on
Why do I say a bounce is coming? Well the hourly technicals for things non tech went way oversold. On top of that look at the daily BBand on NYA and AMEX:IWM
With standing World war 3 or Powell firing you will get smoked if you short this. This is why my favorite longs early this week are Smallcaps and banks.
Focusing on big tech..
If you didn't know that this market runs on a tech bubble then last weeks divergence was your wake up call.
Neither, Dow,IWM or NYA made a new high but the QQQ and spy did.
With that being said you will only know if the spy has topped by keeping track of the NASDAQ..
Qqq
Over the next 2weeks I think Qqq will retest that breakout of 538-540 which is around the 50ma
This drop will bring spy down to 610 retest.
But first I think there is extremely high chance Qqq retest it's 20sma to the upside at 560 to the upside before heading down
I prefer the short up there at 560 but be aware that price could trade between 550-560 to form a H&S
In a move of extreme fawkery we could get a double top instead
But that will only come off Qqq breaks back over 565
Overall, I don't really like big tech long this week. You may have some making moves but it will be a spotty picture with some green and most red or choppy.
The break below the 20sma on Qqq and all tech indexes
AMEX:XLK
NASDAQ:SMH
AMEX:XLC
Means the trend has changed to bearish.. as a trader one of the rules that has helped me is
Swing the trend and scalp the counter trend..
If the market is bullish then you swing calls and scalp puts.
If the market is bearish , you swing puts and scalps calls.
As far as swinging puts this week, just keep your eye on the 20ma of your favorite index/Stock. Once price retest the 20ma , that is the best entry for the short IMO.
The weekly bearish engulfing means that's by WED-Thurs you should stop trading calls and look for market to roll over for more downside.
Spy
Hourly
As long as the market opens above 617, you want to scalp the long early in the week with your target of 626-628.
I don't know if they will close this gap or not, it will most likely depend on Qqq breaking above 560.
Below 617 and 610 comes.
If price pushes above 629 , I wouldn't chase calls here. That double bearish engulfing on daily Time frame is no joke, and price will likely no break above 640.
Trade idea of the week is
AMEX:IWM
200sma is at 216.50
Over 217.00 and I like calls to close gap at 219.40.
Price could push up to 20sma at 222 but from there I like the short back down targeting 210
