AMD and MARKET / HEAD & SHOULDERS AND BACK DOWN $89.11 Exit?
0. Notes to follow;
Comment:
5. We feel if we DO get the next leg down and stabilize, we may have a "Mini Bear Market" for a while, what we call noise, and we don't chase momentum stocks in this environment, we write calls against them;
Comment:
6. Watching how fast we went down here, and the "Buy on the Dip" day today - Robinhood / Retail Madness?, going up as fast as it went down, this type of trading does NOT inspire a "Buy and Hold" mantra, and since last Thursday the Market appears broken once again;
7. We ADVISE caution here, and this rebound may be an "unloading" for a lot of players, and those like Cramer that told Retail Newbies to "Take Some Off the Table" when we rebound. Did they? Don't think so.
8. Lets see what the week brings but we are seriously thinking about PUT options on a bunch of Momentum names as well should AMD go over $90 and charge $100 again;
9. I would say that it is time to trade, and to be honest, the investing, unless you have a diversified portfolio, these Momentum names and the runs are about to come to end we believe, and it may be time for some Bear Market Strategies, heading into election time;
0. We will probably make a run at all time highs again, and if we fail, we are going back down;
1. We are on watch for a MELT UP, if we break ATH, and hold and run, and we are ON WATCH for a MELT DOWN, and we believe that AMD will once again lead the way;
7. We ADVISE caution here, and this rebound may be an "unloading" for a lot of players, and those like Cramer that told Retail Newbies to "Take Some Off the Table" when we rebound. Did they? Don't think so.
8. Lets see what the week brings but we are seriously thinking about PUT options on a bunch of Momentum names as well should AMD go over $90 and charge $100 again;
9. I would say that it is time to trade, and to be honest, the investing, unless you have a diversified portfolio, these Momentum names and the runs are about to come to end we believe, and it may be time for some Bear Market Strategies, heading into election time;
0. We will probably make a run at all time highs again, and if we fail, we are going back down;
1. We are on watch for a MELT UP, if we break ATH, and hold and run, and we are ON WATCH for a MELT DOWN, and we believe that AMD will once again lead the way;
Comment:
STRATEGY
1. Sector Rotation
- We are watching Blue Chips, like IBM for a rotation away from Big Tech that ran hard. We are on watch for a rotation, as they would signal other opportunities, rather than chasing tech, and possibly some rotational plays;
2. ATH - Head and Shoulders All Over the Place
- We are watching TSLA, NVDA, AMD, AAPL, AMZN, and all the momentum names, and Covid 19 plays to see where we are going here. Looking for a run at ATH for all the momentum, and a FAILED RALLY.
- We will be watching, and believe me, we will be nimble. I would say we have a 70 / 30 chance of chasing the highs, and then a complete breakdown;
3. RETRACE
- If we get a continued correction we are watching AMD for movement to
$62.50;
- Yes, this sounds make, but really we are looking at the September 25 or even out to October 23, and seriously buying AMD $60 PUTS, for next to nothing.
- We will probably never see $50 again, but those $60 PUTS will go up exponentially if we head back into the low 70's and test the 60's;
4. AMD $60 to $70 Notes
- We don't have any support and resistance from $60 to $75 at this point. This is a large gap, that may get filled;
1. Sector Rotation
- We are watching Blue Chips, like IBM for a rotation away from Big Tech that ran hard. We are on watch for a rotation, as they would signal other opportunities, rather than chasing tech, and possibly some rotational plays;
2. ATH - Head and Shoulders All Over the Place
- We are watching TSLA, NVDA, AMD, AAPL, AMZN, and all the momentum names, and Covid 19 plays to see where we are going here. Looking for a run at ATH for all the momentum, and a FAILED RALLY.
- We will be watching, and believe me, we will be nimble. I would say we have a 70 / 30 chance of chasing the highs, and then a complete breakdown;
3. RETRACE
- If we get a continued correction we are watching AMD for movement to
$62.50;
- Yes, this sounds make, but really we are looking at the September 25 or even out to October 23, and seriously buying AMD $60 PUTS, for next to nothing.
- We will probably never see $50 again, but those $60 PUTS will go up exponentially if we head back into the low 70's and test the 60's;
4. AMD $60 to $70 Notes
- We don't have any support and resistance from $60 to $75 at this point. This is a large gap, that may get filled;
Comment:
Section Rotation Notes
- More than just IBM of course, looking at Transportation, Financials, Energy, and basically anything that hasn't rebounded accordingly since March 20 2020, and ISN'T on the COVID-19 List;
- More than just IBM of course, looking at Transportation, Financials, Energy, and basically anything that hasn't rebounded accordingly since March 20 2020, and ISN'T on the COVID-19 List;
Comment:
Conclusion
We have as much confidence in this Market and it's Momentum names right now, about as much as we have confidence in a straight-forward and orderly election. It isn't going to happen. We have run too far, too fast, and "taking some off the table" is the right thing to do in what we believe will end in a failed rally and a testing of support lower.
If we are wrong, that is fine. We HAVE a diversified portfolio, we are very close to Crash Proof following a lot of Ray Dalio's work, and sitting on 5 to 8 percent a year. So we keep a 20 percent trading fund, and this is where we try to do 20 percent a year consistently.
You must admit, most long equity and option trades since March 20, have been stellar. Thursday marked the day when "Buy and Hold a Bit" may have stopped working, and the strength of retail investors is about to be tested IOHO.
We would like to see that not transpire, and the Market CAN move higher, if we get an expansion of the equities that are moving up, and not just a few core names carrying the indexes.
We are watching for Rotation away from Tech, to short it;
We are watching for new ATH's to chase Momentum;
We are watching for a continued correction to hedge positions in our core, and make money on the way down;
- drchelsea
We have as much confidence in this Market and it's Momentum names right now, about as much as we have confidence in a straight-forward and orderly election. It isn't going to happen. We have run too far, too fast, and "taking some off the table" is the right thing to do in what we believe will end in a failed rally and a testing of support lower.
If we are wrong, that is fine. We HAVE a diversified portfolio, we are very close to Crash Proof following a lot of Ray Dalio's work, and sitting on 5 to 8 percent a year. So we keep a 20 percent trading fund, and this is where we try to do 20 percent a year consistently.
You must admit, most long equity and option trades since March 20, have been stellar. Thursday marked the day when "Buy and Hold a Bit" may have stopped working, and the strength of retail investors is about to be tested IOHO.
We would like to see that not transpire, and the Market CAN move higher, if we get an expansion of the equities that are moving up, and not just a few core names carrying the indexes.
We are watching for Rotation away from Tech, to short it;
We are watching for new ATH's to chase Momentum;
We are watching for a continued correction to hedge positions in our core, and make money on the way down;
- drchelsea
Comment:
UPDATE
Oscillation Patterns
If you observe the above chart from April 13 to July 10 2020, AMD oscillated in a "noise / mini-bear pattern." It was dead money for three months, and we made a lot selling calls above and puts below, which we documented on Trading View.
There IS a distinct possibility that we go into this until we get some answers to some fundamental market questions.
1. China / U.S. Trade - Next Steps
2. Election
3. Covid-19
4. Back to School / Second Wave.
5. Put whatever here.
6. Put whatever here.
X. Put whatever here.
We will be watching for this "Range Bound" trade. If we see this happening, we would be very pleased. Sideways noise and consolidation is exactly what we need below ATH's and that could last a while, before we go higher. We would be delighted.
We would find the range, say $75 to $80, and we would SELL PUTS at runs to lower support, and SELL CALLS at runs to upper support.
Problems
A. Stock tanks to $60, and we own it with $75 PUTS. Not the end of the world.
B. Stock stays PUT, range bound, we make lots of money selling calls and puts. Mark Cuban Style.
C. Stocks goes Higher, we end up buying stock to cover those calls, and hopefully, we make profit, in terms of the premium and don't get killed on a run higher, unless we have stock behind it.
So it is hard to tell if we are going to become range bound, BUT, I would think we would place some numbers here:
A. AMD to 100 by October 1 (10 percent)
B. AMD to 60 by October 1 (10 percent)
C. AMD Range Bound (60 percent)
D. Leaving 20 percent for another possibility. This scenario may be a slow burn to lower lows, or a slow descend to higher highs. We need another week here to see how it plays out.
We need more clues at this point, to determine where we go next.
So,
1. Dip your toes if you have cash - but keep some money on the table;
2. Take profits if you have tons, and lets some stock ride, it it makes sense;
3. Don't go all in on Margin, nor initiate massive positions right away;
4. Be patient and wait for opportunities;
- drchelsea
Oscillation Patterns
If you observe the above chart from April 13 to July 10 2020, AMD oscillated in a "noise / mini-bear pattern." It was dead money for three months, and we made a lot selling calls above and puts below, which we documented on Trading View.
There IS a distinct possibility that we go into this until we get some answers to some fundamental market questions.
1. China / U.S. Trade - Next Steps
2. Election
3. Covid-19
4. Back to School / Second Wave.
5. Put whatever here.
6. Put whatever here.
X. Put whatever here.
We will be watching for this "Range Bound" trade. If we see this happening, we would be very pleased. Sideways noise and consolidation is exactly what we need below ATH's and that could last a while, before we go higher. We would be delighted.
We would find the range, say $75 to $80, and we would SELL PUTS at runs to lower support, and SELL CALLS at runs to upper support.
Problems
A. Stock tanks to $60, and we own it with $75 PUTS. Not the end of the world.
B. Stock stays PUT, range bound, we make lots of money selling calls and puts. Mark Cuban Style.
C. Stocks goes Higher, we end up buying stock to cover those calls, and hopefully, we make profit, in terms of the premium and don't get killed on a run higher, unless we have stock behind it.
So it is hard to tell if we are going to become range bound, BUT, I would think we would place some numbers here:
A. AMD to 100 by October 1 (10 percent)
B. AMD to 60 by October 1 (10 percent)
C. AMD Range Bound (60 percent)
D. Leaving 20 percent for another possibility. This scenario may be a slow burn to lower lows, or a slow descend to higher highs. We need another week here to see how it plays out.
We need more clues at this point, to determine where we go next.
So,
1. Dip your toes if you have cash - but keep some money on the table;
2. Take profits if you have tons, and lets some stock ride, it it makes sense;
3. Don't go all in on Margin, nor initiate massive positions right away;
4. Be patient and wait for opportunities;
- drchelsea
Comment:
Correction
1. Dip your toes if you have cash, keep it light and smart;
2. Take profits if you have tons, but keep some money on the table, and let some stocks ride, if they make sense, and might have more upside IYHO;
3. Don't go all in on Margin, nor initiate massive positions right away as in tomorrow;
4. Be patient and wait for opportunities;
1. Dip your toes if you have cash, keep it light and smart;
2. Take profits if you have tons, but keep some money on the table, and let some stocks ride, if they make sense, and might have more upside IYHO;
3. Don't go all in on Margin, nor initiate massive positions right away as in tomorrow;
4. Be patient and wait for opportunities;
Comment:
UPDATE
AMD - INVERTED CUP & HANDLE $78 WATCH
So since you may wish to know exactly what we are going to do here. This is it. Besides what we own, we are not buying any more AMD right now.
We are waiting for a break of the $78 mark in a convincing fashion.
I was running AMD on the Neural Network again, many who may have followed us since the beginning when we only covered AMD, know we maintain networks and AI and other advanced stuff, just to track certain names full time. AMD was the first.
Here is our background:
The Prediction Company
en.wikipedia.org/wik...i/Prediction_Company
So we see this inverted CUP & Handle forming in AMD, and the $77.75 number seems to be it, and we were there early this AM, way before the market opened, and you were all asleep. We don't sleep ;) Anyway, we have Bulkowski (2005) programmed into our Network with so many other things, and we see the inverse cup and handle here, that he outlined. Contrary to expectation, with the inverse cup and handle, prices rise prior to the pattern, over 50 percent of the time. AMD rose from $60, and prices rose gently (well sort of), and formed this nice rise up to $90, and then back to $76/$78 from the $90.
AMD - INVERTED CUP & HANDLE $78 WATCH
So since you may wish to know exactly what we are going to do here. This is it. Besides what we own, we are not buying any more AMD right now.
We are waiting for a break of the $78 mark in a convincing fashion.
I was running AMD on the Neural Network again, many who may have followed us since the beginning when we only covered AMD, know we maintain networks and AI and other advanced stuff, just to track certain names full time. AMD was the first.
Here is our background:
The Prediction Company
en.wikipedia.org/wik...i/Prediction_Company
So we see this inverted CUP & Handle forming in AMD, and the $77.75 number seems to be it, and we were there early this AM, way before the market opened, and you were all asleep. We don't sleep ;) Anyway, we have Bulkowski (2005) programmed into our Network with so many other things, and we see the inverse cup and handle here, that he outlined. Contrary to expectation, with the inverse cup and handle, prices rise prior to the pattern, over 50 percent of the time. AMD rose from $60, and prices rose gently (well sort of), and formed this nice rise up to $90, and then back to $76/$78 from the $90.
Comment:
The handle portion now looks to be forming, and this is a retracement upwards, which may have started today, almost a dead cat bounce, and if this retraces back to the lip of the cup, which is around $78, especially if the Handle is a triangle pointed type formation, and then a sell signal is triggered when prices surpass the low of the bottom of the right side of the cup.
According to analysis and Bulkowski, the average decline would be 16%.
This would take AMD to $65.50
We would BACK UP THE TRUCK at this level.
We are not waiting for that, we are looking for this pattern to play out, and if it does, it will be seen everywhere. GOOG, APPL, FB, NVDA, all the momentum names will exhibit this pattern, and it has many similarities to the Head & Shoulders Pattern.
We are not looking for anything here but a better entry on AMD, as we have a lot, but we always want to add more as we increase the size of our portfolio.
Just some thoughts as we stay up late and crunch numbers and look for clues.
Cheers.
According to analysis and Bulkowski, the average decline would be 16%.
This would take AMD to $65.50
We would BACK UP THE TRUCK at this level.
We are not waiting for that, we are looking for this pattern to play out, and if it does, it will be seen everywhere. GOOG, APPL, FB, NVDA, all the momentum names will exhibit this pattern, and it has many similarities to the Head & Shoulders Pattern.
We are not looking for anything here but a better entry on AMD, as we have a lot, but we always want to add more as we increase the size of our portfolio.
Just some thoughts as we stay up late and crunch numbers and look for clues.
Cheers.
Comment:
FUTURES
You know I just got another alert off the network, and the futures are going down 100 and up 100 and if this nonsense keeps up, Cramer will be giving another speech on how the Futures are MEANINGLESS. That was during Feb 20 to March 20 2020. He made me laugh a lot during the crash.
Looks like VOLATILITY is back, and that might be the play.
UVXY, TVIX, VXX. Maybe a nice Married PUT for 1000 shares on UVXY, if AMD gets to $89.11?
You know I just got another alert off the network, and the futures are going down 100 and up 100 and if this nonsense keeps up, Cramer will be giving another speech on how the Futures are MEANINGLESS. That was during Feb 20 to March 20 2020. He made me laugh a lot during the crash.
Looks like VOLATILITY is back, and that might be the play.
UVXY, TVIX, VXX. Maybe a nice Married PUT for 1000 shares on UVXY, if AMD gets to $89.11?
2. We are looking for a Head & Shoulders Pattern on AMD here, and a run at $90 again, which we believe will fail;
3. We are holding AMD, and looking to COLLAR our position, if we hit $89.11 and above;
4. We are hoping that AMD WILL signal the next leg down, just like it did in February 2020;