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SPX Weekly review and forecast: August 1, 2022Last week, the markets saw a strong move to the upside with the SPX closing just shy of 4150 (4133). The move was largely fueled by FED chair Jerome Powell's comments, as well as strong earnings out of mega market cap stocks such as AAPL and AMZN. AMZN rallied +17.5% on the week and is up a whopping +32% from its low on June 13th. A similar story for AAPL, which is up +8.3% WoW and +25% since June 13. Joining the party, energy stocks like XOM reported very strong profits which vaulted the XLE higher. So far, the primary thesis of a bullish continuation being powered by energy (XLE) and technology (XLK) has come to fruition. The question, of course, is how long it will last - but first, a snapshot of last week's action: SPX: +5.2% Nasdaq: +6.8% Russell: +4.5% __________________ Technology (XLK): +7.5% Energy (XLE): +9% Financials (XLF): +3.9% Looking ahead to next week, the SPX is poised to retest the price zone between 4100 - 4200 which proved to be considerable resistance back on early June. The probabilities suggest some range bound action here, before the next major move. Needless to say, there's a chance that we could see a forceful continuation, and an even smaller chance of an outright rejection. Regardless, given the improving conditions, 4300 and 4400 are very much in play as potential upside targets heading into Q4. The expected moves for this week are +/- 81.30 (SPX), 8.81 (QQQ), 4.8 (IWM). The Nasdaq is clearly in the pole position for this rally, and is threatening to push back to 14,000, but with another busy week of earnings, as well as unemployment numbers, and more inflation data, there is still plenty of fuel to spark volatility (which has fallen off a cliff). Best of luck this week. If you found this helpful, please let me know!
FX:SPX500Long
by InnerMotionTrading
Looking ahead to next week in the S&P (July 25th, 2022)With things like housing statistics, employment data, and earnings from heavyweights such as GOOG, MSFT, and 3M, next week looks to be filled with potential market moving events. Most notably however is FED Chair Jerome Powell's press conference on Wednesday afternoon. While its no secret that we're headed into a world of higher interest rates, FED speak always has a tendency to move markets one way or another - but before we look ahead, here is a quick snapshot of last weeks action: S&P500: +2.3% Nasdaq: +3.3% Russell: +3.3% ------------------- Technology (XLK): +6.5% Energy (XLE): +4.5% Financials (XLF): +2.3% Heading into next week, SPY is looking at an expected move of +/- 9.8 on 24%IV ... (QQQ +/- 10.3, 32%IV; IWM +/- 5.6, 30%IV). SPY appears to be gaining steam on the shorter time frames (4HR, etc.), and I think the sectors driving the rally have more room to run, so my primary idea is for the rally to continue over the intermediate term. There may be some turbulence along the way, so perhaps a retest of the top of the previous range around 390 before ultimately heading toward 415. However, don't ignore the bonds. They have seen a solid rally off their lows in June. If momentum can continue, bond prices could accelerate up to 149"00, which would almost certainly lead to weakness in equities. Please note: these are not predictions - they are just my ideas about how I'm seeing the markets and are to help me formulate my own trades. If you find this helpful, please consider liking, commenting, following, boosting, baking cookies, setting me up with your single friends, blah blah blah blah...
AMEX:SPYLong
by InnerMotionTrading
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OXY - another interesting proposition TAKENOXY was recently highlighted during the recent crude oil ease off retracement. A friend kept talking about it, and new about Berkshire (Buffet) accumulating this stock kept making headlines over the past couple of weeks. It was in the radar screen as this was something I missed earlier and looked for ward to getting some position as the crude prices should be expected to rocket higher. So, as Crude bounced off the support level (in the other post), the daily chart was tracked for a possible entry. Compared to SOXL, this was not as pretty, but it would do for now. Support held, bounced off, technicals on the daily were supportive of a bullish rally, Crude oil just bounced, and overall this was considered a low risk entry, so a position was taken (white arrow). Currently is resistance zone. Let's see if it has the resolve to break above... it should.
NYSE:OXYLong
by Auguraltrader
Possible price paths for SPY over the next 4 - 8 weeks (2022)Forecast ideas for the week of July 18th, 2022 Here are my thoughts about where the market may be heading over the short-to-intermediate term, and how it may get there... After selling off most of last week, the S&P has rallied about +4% off the July 14th lows. The rally was propelled mainly by tech stocks like AAPL and QCOM, as well as financials like MS and BAC. Despite this impressive move, the market has been stuck in a rather precarious 250 point range for about a month. Another interesting sector has been the XLE (energy). It has seen spectacular moves in both directions, and is currently down about -30% off its June highs. However, XLE looks like its showing signs of a dead cat bounce. If this occurs, it would carry the S&P with it. Heading into next week, I'll be watching XLE closely - and possibly shopping for some swing trades to the long side. As of now, I think the bullish pathways have a slightly greater probability of being realized over the next 1-3 weeks (referring to the break of the range), but I am lightly allocated, and very much in a "wait and watch" mode. If the market breaks the range to the downside (below 375), volatility and SKEW have nowhere it could but up, so get very ugly, very quickly. Note that the pathways aren't predictions. They are just general, hypothetical guidelines. The price points are more important to the overall narrative. Good luck; lets see how it goes!
AMEX:SPY
by InnerMotionTrading
A New Long Opportunity In Energy: $AMLPEveryone knows that $XLE has been out performing for the last two years. If you missed the move here's an opportunity at a new comer to the breakout in energy, $AMLP. This ticker is an ETF that tracks a basket of MLP stocks. It's concentrated at just 17 holdings and its currently boasting a yield of 7.4%. The monthly chart looks a lot like its cohorts in the energy space did just a few months ago. This is a monthly candle chart with no annotations or judgements by me. The 36 Month SMA served as resistance until recently. That resistance was flipped and tested. The flip was successful and former resistance is now confirmed as support. The ETF is now convincedly above is 10 Month EMA for the first time in years. There's also a long term gold cross forming as the two moving averages converge. On the daily chart its fighting some resistance in the $38 to $41 range for sometime now. This looks like a good one for the watch list.
AMEX:AMLPLong
by Breakout_Charts
#BRENTCRUDEOIL Still making higher lows within triangleIts no surprise anymore that OIL and energy stocks have been one of the only places to find some alpha this year. Even with oil taking a bit of a beating lately, looking at the technicals we are still in a very healthy shape for the time being with Brent Crude making higher lows within this triangle formation and well above its ascending 200 day moving averages. Until this breaks down, you have to give energy the benefit of the doubt to run higher this year..
TVC:UKOILLong
by MarcoOlevano
Oil and gas producers have come to a dead endLast Friday WTI crude NYMEX:CL1! dropped together with the broader equity markets and closed almost 7% lower at $107.99, slightly below the 50 days moving average. Earlier in the month the oil was still trying to break and stay above $120 however the hype cooled down quickly, partly due to the sharp 75 basis points rate hike by the Fed on Wednesday. This recent round of oil rally actually started in late Dec-2021 when the oil price tested the 250 days moving average, failed then reversed back to the upside. In late Jan-2022, the global inflation concern pushed the commodity across the major resistance at $86. And by late Feb-2022, fueled by the “special military operation” initiated by Russia against Ukraine, WTI crude went through the $100 handle and never looked back again. With the recent more affirmative backdrop of global recession, as well as the increasing political cost for the current government allowing inflation to worsen, last week's drop might officially mark the end of the 6 months long oil rally. There are 2 ways you can capitalize the idea. One is to short the commodity directly. Two is to short those who produce the commodity . In the following scenario analysis, we believe the second seems to be a more profitable way, even if oil price continue to rally. 1. Oil Price Up Although it’s unlikely, there are still factors on both the demand and supply side that might drive up oil price, such as extreme weather and military conflict. Another wild card is OPEC. But in any case, one thing for sure for the US government is that the oil companies are making a lot of money. The US president Joe Biden even directly pointed out “Exxon made more money than God last year” in a recent event in Los Angeles. With Britain recently announcing a 25% windfall tax on oil and gas producers, the white house is even more motivated to join “Robin Hood” to rob the rich (whether to give to the poor is another matter, lol). The windfall tax essentially is setting a profitability ceiling for oil companies. Even if the oil price goes higher, they will not be able to pocket more money. 2. Oil Price Down (Supply Side) This is likely to be a continuation of the windfall tax narrative. One option the producers can choose instead of paying more tax is to increase capex, i.e. increase oil production by drilling more crude, and expand refinery facilities. In fact, raising capex is the last thing the producers want to do given the global carbon zero commitment and the shift in consumer behavior such as shifting from traditional fossil fuel vehicles to EV. Hence if the oil companies at the end really compromised, their profit and distributable cash would definitely be harmed. 3. Oil Price Down (Demand Side) In the market economy we trust, even without government intervention, the market itself has an in-built feedback mechanism to neutralize any imbalance. When oil price is too high, demand will naturally be depressed (e.g. drive less, work from home more, take more public transport). Less demand in turn will pull down the price until demand-supply equilibrium is restored. If we look at the latest release of companies Q1 result, the economic slowdown is no longer a slogan but has already materialized. The demand downward spiral has actually taken place in the US, and it is only one trigger away to set this into motion for the oil market as well. For the oil producers, it means selling less oil at lower price, double whammy for their profitability. Now it should be clearer why no matter how the oil price moves from this point onward, oil companies have all reached a dead end. Trading Plan Instead of hand picking which producers to short, one can directly short oil & gas theme ETF, effectively shorting the whole bucket of companies in the sector to avoid tail risk from individual companies. I would recommend AMEX:XLE and AMEX:XOP for this operation, for their larger market cap and better liquidity. The best time to short was actually 2 weeks ago when oil price was still above $120 and there was a divergence between oil price and the major equity indexes. I placed my first short position in AMEX:XOP on Jun-10 at $161. Last week the drop was faster than I expected. In fact all the nearby resistances were taken down one by one without much consolidations: 20 days moving average: Jun-15 50 days moving average: Jun-16 Lower bound of bollinger bands from 20-days moving average: Jun-17 For those who are looking to raise their short exposure, I would recommend to wait until it rebounds back to one of the above resistance levels, place the short when the buying momentum dries and the selling force becomes dominant again . That translates to price levels around 140-155. For those who are looking to buy (Note: profit taking only, not buying in anticipation of new highs), the following levels are the major supports of this round of rally: May support: $123.5 Feb pre-war peak turned support: $115.2 250 days moving average: ~$110 Last note I want to share this week is, never rush into a trade. Any last minute rush means your preparation is inadequate. If you missed a trade it's not because you were not decisive enough to rush in, but because you did not do your homework. So stop overthinking about what you have missed, focus on the next, and make sure you win when you are right. I wish you all a happy and prosperous trading week ahead!
AMEX:XOPShort
by geoffreyip523
$OXY Bearish Sentiment - In Line with Energy Sector Rather than look at XLE or the energy sector as a whole - looking at an integrated Oil and Gas company with more volatility gives us a better picture of the environment. There are obviously severe worries of a recession - hence the breaking of correlation between OXY and OIL futures the past couple days. With oil futures falling as well, the backdrop sets a fairly bearish tone for the short term. Looking at the levels, OXY could fall into the mid 40s prior to consolidation and then possible bullish setup. Bullish case: Russia and/or OPEC production shortages supply constraining...US Demand stays strong...GDP growth stays positive for Q2 Bearish case: Oil continues to fall due to expected demand falling... Russia/OPEC issues subside/aren't as bad as expected...Fiscal policies before midterms
NYSE:OXYShort
by MatthewMontella
XLE breaks TL but holds vol profile zone(75-77); is 71 or 65 nxtUpdate on my last post that XLE energy sector must hold the red trendline at 79. BEARISH CASE shortterm: On Thursday it broke not only the TL but also broke below my yellow consolidation box.(middle one). As of now it is holding the volume profile zone at 75 to 77 area. Looking at the heavy selling volume in all sectors, a double bottom at 71 is very probable. 76.70 is the 0.618 Fib level while 71 is the 0.786 Fib. Worse, we may even see a retest of the blue wedge at the 65 pivot line. That will be a 100% retracement back to the Feb 24 invasion low. (It broke out of the blue wedge & retested it last Jan 2022 & proceeded to make a measured 10 points move to 82 & then another 10 points move to 92) Still BULLISH longterm: If XLE bottoms out at the current volume profile zone & reclaims the red trendline in the next few days, we may see a retest of 92 or maybe even push another 10 points higher to 102. You may ask if that is still possible with a slowing economy? Bear markets on average starts 5 months before actual recession (2 consecutive Quarters of negative GDP). We are now at the 5th month but employment & production & consumption numbers still suggest recession is still far out maybe in 2H2023. Either we are in uncharted territory with a prolonged bear market or maybe we will see another melt-up rally first before recession kicks in. This will be possible if inflation & rates slow down with the FED pivoting to less hawkish stance in September after the already priced-in June & July 75 basis point rate hikes. Note: A slowly rising dollar will not be good for commodities like oil, food, industrial metals & gold but it will help cushion the bad effects of inflation on buying power…good for imports but bad for exports. Not trading advice. Pls like & follow if this helps!
AMEX:XLELong
by xtremerider8