How To Get The Last RIP Out Of The Bowl... if you're in to that

JerryManders Updated   
At this point, share holders just leave, options players there is still some change long.

- Don't expect a new bull market that welcomes building new underlying positions at these levels, but at the same time be careful shorting yet either

- below is a summary of the possible scenarios to expect from here (if you don't like the "noise" in the chart I suggest picking a profession or hobby that doesn't deal with non-linear systems/stochastic processes)

((I'm wasting my time typing this out so no excuse to complain, boost this instead))


* Good chance of some explosive downside next week (through 2/22), possibly even a gap down Tuesday morning that the new will call the "start of a crash"

** As long as SPY does not make a sustained break below 482.89 this will present a buying opportunity for those of you that don't mind considerable risk but like money

Most likely scenario: dip to 492-495 and then run to test 502. Possible results based on that:
1) green arrow: breaks above 502 and runs to 506-516 (point target 510). That allows for 15-18 points upside, Buy the Mar 8 expiration 500 calls or Mar 15 505 calls when SPY hits 495 - not financial advice.

2) red arrow: rejected at or before 502 (sell half of your calls ITM and wait for rejection or break to decide on keeping remaining half). If rejected here and then makes a lower low look out below. Would possibly get a dead cat bounce and then its cashed for now.
IMPORTANT** (do not disregard this comment):

There is a possibility that we get a drop to 457-460 by March 5th 2024 (-8%).

I won't be buying calls on this pullback like originally suggested in this post - rather, I'll be looking for a break below 495, followed by rejection at 495. If we get that then there is a high probability that we see downside continuation to at least 480-485 (but possibly 457-460)... so I'll be looking to enter puts rather than trying to get the last rip out of this.

Gap down Tuesday 2/20 will greatly increase chances of bearish scenario.

Dashed Red/yellow down-sloping line is the most important - it represents the selling pressure that can bring this down. If it breaks above and escapes the selling pressure, then it will bounce at equal and opposite trajectory.
Looks like we'll get a chance to get that last rip. Sustained break above 500 and we'll run to at least 507-509. As long as this doesn't sell off at open and break back below 495 bulls have it near term with a near-completed (and very gnarly) flat corrective wave 4 (smaller degree).

I'll send my EWC count in an update. Not shown in chart. Essentially I was counting on a slightly deeper wave 4 before beginning 5, but shorts are getting squeezed here.
Follow the green arrow that extends into the highlighted yellow region as primary path from here.
Refer to my most recent post for SPX500USD going forward for updated Market forecast:

Bullish on SPY/market for 2/26-2/27.

- expecting continuation higher to 512-516 by end of day Tuesday 2/27
- then pullback starting 2/28 to test 503-504 for support
We got a good last rip. Now expect pullback early next week to around 502-505. If that holds as support then we can continue back up. Just know we are rippin' a nearly cashed bowl at this point... so groovy.
Short it.
Starting to leg back into Mar 28 515 calls if we get small pullback going into close. It could still drop a few points, but the set up is bullish - with CPI as a catalyst tomorrow SPY could break above 514 and run to 521-527 by end of March.

Near-term bullish with buy zone = 505-510
Calls from Monday working out nicely. Will look to take profits based on the following expected path from here:

- initial target = 519.23 today 3/13
- primary target = 522.43 by 3/15 end of day (I will take profits on two thirds of my position here, i.e. sell ~67% of my calls)

** 2 bullish scenarios based on how it trades around primary target:

1) most bullish = break above 522.43 then continue to 533 by 3/22 earliest (if we get this scenario I will sell the rest of my calls and swing to puts because that will be a crash setup)

2) less bullish but more stable structure = rejection at 522.43 and then pullback to test 514-518 for support before continuing higher to 527 by 3/28 (will sell remaining calls there, but not immediately switch to puts).

Obviously have to play this as it goes but thats the gameplan to maximize profits on the Mar 28 calls.
If you're scared go to church.

Bullish until we take out 5300s in the coming weeks. Stop loss = sustained break below 506.

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