So last night we had the Moderna vaccine news come out, saying that their phase 2 trials were successful. This is actually, the same news that they released last month that gave us that huge gap up if you remember. But this time around it was peer reviewed, so as it turns out. They were not full of shit. Good for them, and frankly everyone else as well.
After that, which pushed a gap up in the market which held basically all night we had decent from GS (not so much from some of the others) who had a 94% increase in their trading division and absolutely crushed it, and also positive news on AAPL not getting taxed some billions of dollars by the EU. All of that was a jab, jab, hook combo to the bears going into open. But here's the thing. They STILL couldn't get us a close over last months highs. We printed a marginal new high in SPX again by a couple points but we still haven't had any meaningful close above. We're technically still range bound. They literally had it on a silver platter. Wrapped with a bow. Door wide open. And still couldn't take it. This is a lack of participation. A lack of follow through.
Now, before you think i sleep with my bear suit on. The fact that we haven't been rejected from this level is telling. We even had a daily close above where we were last week, which is progress. Stairs up, elevator down. But this staircase sucks. Any time you hang around an important level like this for an extended period of time most of the time it will break through. It's gaining strength, energy. Coiling up. But the proof is in the proverbial pudding. And we need to start closing above last month's highs.
If we don't do this we're in danger on now printing a triple top after today's close. It's pretty simple at this point. Closes above last months high equals higher prices. Hourly closes the other direction, especially if we break under the top megaphone equals much lower prices. I would not be surprised if they try and gap us over again tomorrow or the next day if they can't do it in the cash session. Again was higher than it was last week, but trending downwards. Which in general isn't a very comforting sign.
Ok, now that we got that out of the way let's talk about who were the beneficiaries of cup game today.
IWM and DJT.
IWM was up 4% at one point. DJT up 3.25%. Both closes modestly off their highs. Again, just like we saw yesterday people are cycling out of growth, into the rest of the market. This time small caps and transports being the darlings. Carnival was up 16% today..
This now brings everything i watch over their 200 period MA's besides XLF . But all major indexes, including small caps are now on the chart. Everything is catching back up. The market is rebalancing. It was interesting to see DJI was showing relative weakness today but the percentage gain winners today were IWM , DJT, SPX , DJI, and NDX in that order. Yeehaw.
Now what could be happening is everything is staging. Especially SPX . Think of how an army would build up troops behind the line before an attack. Making sure everyone is in the correct position before they go across the wire. As soon as everyone is in the correct place for the attack they come across. IWM , and DJT may be the last to get into position.
In reality this is just money looking to diversify and getting into places of value. IWM and transports were kind of the the last ones picked during gym class so to speak. The real question is after everyone is fully diversified and the breadth is healthy again can they sustain a rally to new highs. I saw apprehension today. If not just plain non participation. Which again could be people focusing their computers or traders on the stocks that are the "reopening" trade and value stocks.
Now, i'll say it again. It's incredibly interesting to me to see this before . That raises the stakes. Usually i'd expect big money to take these positions once there's more of a clear picture of who's doing what, how they're doing it, and in they have any guidance for the future. The last thing you want to do is take a position in a name and then get whacked because they missed on . But again, the market is forward looking and big money is also forward looking with it. They're looking 1-2-5-10 years out. Might as well start climbing the wall of worry now.
5m shows up opening right at the highs from Mon. That's a start. There was some pretty interesting price action in the first 15 mins of the day as traders jockey'd over each other and then they went for it, and almost had it. Again. But for some reason the market thinks we're not worthy for breaking out just yet and we reversed below my at $320.11 and everything looked like it wanted to go for the same day gap. None of them hit it. That's a signal. Then everyone seemed to go have a liquid lunch as we algo pumped back upwards and then after a peculiarly candle right at 3 we hit support perfectly, and then went to go for the obligatory pump into the close. Almost made it. There was a pretty slick bear counter attack that last 5 min candle that had us closing below, again.
The bulls are at a critical point on this chart. They NEED to break out here. Usually, under normal circumstances if they don't we'd retrace back into the lower bound of the range. Expect either, in my opinion, a gap over, or a rejection tomorrow or Friday. The part is they tried to reject from this level twice already and it was bought up before we could get much lower than $311, a new
But i do keep my bear suit nearby at all times. If we do breakout we will have this divergence on , and like i've mentioned before these sometimes take forever to play out if ever at all, just look at NDX. But it's there on every timeframe from the 5m to the daily.
Couple things we can pull from the daily. First being we did close the day confirmed outside of the triangle. Second we gapped above the range we were in last week and closed above it. Third being that we went back into that zone we just left and we retraced from there. We almost retested the triangle and traded away from it. That's . But technically this can be construed as a reversal candle. We could absolutely wake up tomorrow to either a gap down or get to open and they trade away from this level again. And honestly at this point i'm not sure what the hell plays out. But that's what i'm seeing.
ES did make a new high today on a closing basis depending on the chart you're using. This is the 30m and 3h. There's really not a lot to be gained from this chart. The past two months are an absolute mess, at least in my opinion. The only thing i think i'm starting to see is a broadening top the past couple days. Past few times they haven't been fruitful on ES particularly. Divergences are there as well.
SPX with it's marginal new high today, especially over yesterday. And Ohhhhhh so close there at the close.
Little clearer on the hourly. Second wick above last months high in two days but can't get the hourly close. But yet to trade away from here either.
SPX printing a slightly more close than SPY with just a instead of that
IWM conveniently gapping up over it's , and a nice restet as well but getting a gentle little rejection as it tried to leave it's downtrend from the Feb highs.
"Thanks Moderna" - All IWM /RUT traders. Notice that tactical gap. And i mean that's a huge day.
Finally clearing the .236 fib, 200 period MA, and major resistance at $145, all in one move.
VIX is being incredibly resilient. Even with the gap up today at open we were only down like 1.8% or something. It's used this confluence of support including the .786 fib, 200 period MA, and generic support line. It's going to be interesting to see if we break out if VIX breaks down. That's going to be integral to me buying fully into both figuratively and literally.
XLF 5m cup and handle???
Hourly looks like an extended . But those have played out so often recently /s
Daily also printing a
Dude this uptrend line has begun to be the battleground for DJI the past month or so. They Finally regained it today, and even retested it a couple times.
Also looks bear flaggish on the hourly, but so far got bought up before filling the gap
Can't fill a gap? Just gap over it. That's what they attempted to do. It looks as if it wants to go back and fill both gaps.
QQQ ... ????
There is still a HUGE divergence to play out as well as a gap minefield down below
Daily close looks relatively though
DJT traders about to send a fruit basket to Moderna as well. Look at the gap, almost perfect, and all the way to my next target
I honestly think silver is just getting started. Holding key levels and closing above again
Same with gold with a nice little consolidation over $1800
Talk about pinned. How would you like to be on a desk trading the 10 yr right now? haha
Jobless claims tomorrow morning which could or could not be important. Depending on how the market's feeling.
If you're still sticking around after this washing machine of the market we've been trying to trade you're probably well weathered and relatively frustrated trying to get winning trades. But think of it like this. When we finally do start a trend it's going to be that much easier to trade.
I did (finally) get stopped out of my trade today, but haven't adjusted my positions or reallocated yet as i couldn't find an entry. -7 delta as of right now.
Speaking of rebalancing and playing catch up DJI has closed it's gap from it's island reversal today, but left one from gapping up into it. IWM is still 3.5% away from its' gap, but as today shows we can do that all in one day.
Happy trading and as always keep your head on a swivel. Hopefully We'll get some action here shortly with either a legitimate breakout and making of new highs or a rejection and a crash back into $300.
Thanks for reading.
This is not trading advice. This is my own personal opinion based on my own personal TA. You are responsible for your own trades.
If you were not aware i am starting a website. Aptly named M1904trading.com where i will be doing what i do here, but unfortunately will be taking it private. The content portion will have multiple different write ups from an intro to options, market nuances, how to effectively hedge, etc.
The website will be subscription based with the daily newsletter/analysis being $20 a month, which is about $1 to compensate me for my time as these take about an hour a piece.
If you pre register on the site you'll get the first month at half off and also exclusive access to the write ups.
Thanks again everyone!
We slightly traded away from the front line overnight. Retail sales and initial jobless claims up in about 25 mins. We'll see how the market's feeling about it.
But, if we keep trading away from here, and even if we were to open here it'll validate the hangman reversal.
We'll see if the buy the dip gang has clocked in yet.
We're most likely going to open just at, or right above or below $320.11 which is support.
If for whatever reason that fails we have support at $315.52-$315.18 and if we do break below that we HAVE to break that top megaphone trendline if this is anything besides a reload for big money to take another shot at resistance.
It honestly looks like AMZN is the one single handedly lifting the market right now. Maybe with an assist from NFLX.
If you do not already know i am planning on taking these posts private. The daily updates/newsletter will be the same as they are here, but paywalled. The membership will be $1 a day, or $20 a month. If you pre sign up for the website you will receive the first month for $10 or half off.
We will also have resources including how to chart, market nuances, and basically everything i know downloaded all into one place.
The website is M1904trading.com and if you enjoy this either pre register or check out the website come Monday.
in order to hit spy 290 by tomorrow, didnt do the math, but id assume there would be at least 1 circuit breaker in there lol. also that would throw a huge shit fit into the market.
i saw some1 post unusual options activity for VIX 70 call that expired this friday or next friday i think, like a huge amount placed for those contracts at 0.05 each. seems like a huge hedge with short expiration. would take a lot to get us that high that quickly
gearing up for a large move later?
odd that vix is dropping and spy,iwm,qqq,dia are all flat for the day. its as if vix is intentionally being killed while keeping the market flat for some reason i can't even guess at?
i think we usually see this activity on days when j powell is going to speak, and this happens up until he speaks and then shit gets crazy. but i don't know of any events happening later today