Trading Plan for Wednesday, May 15th, 2024
Trading Plan for Wednesday, May 15th, 2024
Market Sentiment: Bullish, consolidating within a tight range after a strong rally. The market could continue to build out a bull flag pattern or break out directly to new highs.
Key Supports
Immediate Supports: 5329 (major), 5318 (major), 5302-04 (major)
Major Supports: 5272-74 (major), 5236 (major), 5208 (major)
Key Resistances
Near-term Resistance: 5347 (major), 5365-67 (major), 5386-89 (major)
Major Resistances: 5404-07 (major), 5450 (major)
Trading Strategy
Chop Zone Management: The market is consolidating within the 5302-5347 range, with an even tighter range of 5329-5347. Avoid overtrading and focus on level-to-level scalping for small gains.
Long Opportunities: Look for a bounce and reclaim above 5317 if the 5309-11 area is tested. If the market dips lower, consider longs at 5302-04, 5272, or 5287 (major).
Short Opportunities: As always, avoid shorting green candles and breaking trends. If considering shorts, 5342-47 may offer a potential dip, but proceed with extreme caution.
Bull Case
Bull Flag Continuation: The market may continue to build out the 5309-5342 bull flag pattern, potentially breaking out for a new push into all-time highs (ATHs). Target 5359, then 5375-77 in this scenario.
Consolidation and Breakout: If the market consolidates within the 5329-5347 range and breaks out above 5347, it could target the resistances mentioned above.
Adding on Strength: Monitor overnight action for potential flagging below 5219 as a possible entry point for adding to long positions.
Bear Case
Breakdown Signals: A convincing break below 5302 could trigger a deeper retracement, potentially targeting 5272 and lower.
Entry Points: Look for a bounce attempt and rejection at 5302, then consider entering a short position around 5300. Remember to manage risk with level-to-level profit-taking.
News: Top Stories for May 15th, 2024
📈 Renewed Market Rally: The stock market has experienced a renewed record-setting rally, surprising many of Wall Street's top strategists and prompting revisions of year-end S&P 500 targets. This surge reflects robust confidence in market fundamentals and investor optimism.
🌍 Geopolitical Tensions and Commodity Prices: The death of Iran's President Ebrahim Raisi in a helicopter crash has introduced new uncertainties into the oil market, potentially affecting global oil prices. Concurrently, gold futures have reached new record settlements amid growing geopolitical tensions and rate-cut expectations.
🏦 Federal Reserve's Economic Outlook: The minutes from the Federal Reserve's latest meeting are highly anticipated as they may provide further clarity on the timing of potential rate cuts and reveal the level of consensus among policymakers. This release is crucial for understanding the Fed's future monetary policy direction.
💼 Corporate Earnings Reports: Nvidia's earnings report is particularly significant as it is a key driver of the S&P 500's recent growth. Investors and analysts will be closely watching this report to gauge the health of the tech sector and its impact on broader market trends.
📊 Global Economic Indicators: Recent data releases, such as the CPI report and retail sales data, have fueled speculations of a cooling economy. These indicators are essential for assessing the overall health of the economy and potential shifts in monetary policy.
Market Sentiment: Bullish, consolidating within a tight range after a strong rally. The market could continue to build out a bull flag pattern or break out directly to new highs.
Key Supports
Immediate Supports: 5329 (major), 5318 (major), 5302-04 (major)
Major Supports: 5272-74 (major), 5236 (major), 5208 (major)
Key Resistances
Near-term Resistance: 5347 (major), 5365-67 (major), 5386-89 (major)
Major Resistances: 5404-07 (major), 5450 (major)
Trading Strategy
Chop Zone Management: The market is consolidating within the 5302-5347 range, with an even tighter range of 5329-5347. Avoid overtrading and focus on level-to-level scalping for small gains.
Long Opportunities: Look for a bounce and reclaim above 5317 if the 5309-11 area is tested. If the market dips lower, consider longs at 5302-04, 5272, or 5287 (major).
Short Opportunities: As always, avoid shorting green candles and breaking trends. If considering shorts, 5342-47 may offer a potential dip, but proceed with extreme caution.
Bull Case
Bull Flag Continuation: The market may continue to build out the 5309-5342 bull flag pattern, potentially breaking out for a new push into all-time highs (ATHs). Target 5359, then 5375-77 in this scenario.
Consolidation and Breakout: If the market consolidates within the 5329-5347 range and breaks out above 5347, it could target the resistances mentioned above.
Adding on Strength: Monitor overnight action for potential flagging below 5219 as a possible entry point for adding to long positions.
Bear Case
Breakdown Signals: A convincing break below 5302 could trigger a deeper retracement, potentially targeting 5272 and lower.
Entry Points: Look for a bounce attempt and rejection at 5302, then consider entering a short position around 5300. Remember to manage risk with level-to-level profit-taking.
News: Top Stories for May 15th, 2024
📈 Renewed Market Rally: The stock market has experienced a renewed record-setting rally, surprising many of Wall Street's top strategists and prompting revisions of year-end S&P 500 targets. This surge reflects robust confidence in market fundamentals and investor optimism.
🌍 Geopolitical Tensions and Commodity Prices: The death of Iran's President Ebrahim Raisi in a helicopter crash has introduced new uncertainties into the oil market, potentially affecting global oil prices. Concurrently, gold futures have reached new record settlements amid growing geopolitical tensions and rate-cut expectations.
🏦 Federal Reserve's Economic Outlook: The minutes from the Federal Reserve's latest meeting are highly anticipated as they may provide further clarity on the timing of potential rate cuts and reveal the level of consensus among policymakers. This release is crucial for understanding the Fed's future monetary policy direction.
💼 Corporate Earnings Reports: Nvidia's earnings report is particularly significant as it is a key driver of the S&P 500's recent growth. Investors and analysts will be closely watching this report to gauge the health of the tech sector and its impact on broader market trends.
📊 Global Economic Indicators: Recent data releases, such as the CPI report and retail sales data, have fueled speculations of a cooling economy. These indicators are essential for assessing the overall health of the economy and potential shifts in monetary policy.
