Week Ahead: August 8, 2022 - SPY 400/420; CPI on Wednesday; PPI Thursday; mixed technicals.
Howdy, friends. šIām back. I was away for a week or so. I didnāt make any trades during this time and didnāt follow the market. So, Iām coming in fresh.
Economic Calendar: https://www.marketwatch.com/economy-politics/calendar | https://twitter.com/DeItaone/status/1556289624091332608/photo/1
- Monday: Nothing.
- Tuesday: Nothing.
- Wednesday: China CPI, Germany CPI, US CPI - all premarket. Fed Speakers @ 11am and 2pm
- Thursday: PPI in premarket
- Friday: UK GDP, France CPI in premarket; UMICH Sentiment @ 10am
Thoughts - General:
- SPY 413 - wow. Last trade I made, it was 391. Looks like Hot Girl Summer Rally started while I was offline.
- Looking at just the charts, I think thereās two scenarios that could play out in the coming days/weeks
- October 26, 2021 - went from 455 to 470 by November 8, 2021 before cooling off
- OR June 7, 2022 - consolidation before jumping off a cliff
- Weāre likely to consolidate to the slight downside until Wednesday - when CPI + Global CPI numbers come in - which will either send HGSR on its way higher OR stop it in its tracks - for now.
- The rally weāve seen seems a bit silly - maybe it's not - but the SPY/market in general just wants to go up - for any reason it can find. Itās default is always to the upside. THereās also piles of cash on the sidelines that has been waiting for a reason to jump in -- and earnings season wasnāt a let down.
- JPow doing another 0.75 (second in a row) makes it seem like weāre on the right track to taming inflation.
- Weāre likely to see some inflation numbers cooling in this Wednesday CPI report, especially the headline (impacted heavily by falling gas prices), but Core CPI may be a bit tougher to shake ā but they will look for ANY positive in the numbers to push it up
- Government is warming up its cash firehose again - climate, health, chips, etc. bills in excess of $500B. Theyāre going to make it rain.
- All this sure seems like the final leg before a recession/bust comes in. The warning signs are popping up everywhere in the ECONOMY, not necessary the stock market; despite the job report on Friday.
- We also had a better than I expected earnings season - but donāt ignore those warnings we got. On the flip side, we got some very bullish guidance from the majors (MSFT, AAPL, etc)
- Itās tough. Thereās opinions on both sides that make sense. Technicals are mixed at best.
- Regardless of next couple weeks, I think we pull back very hard in 4Q when real economic situation rears its head
- I need to read more this week, for sure. Look for further updates during week.
Thoughts - Technical:
- SPY levels: 390 (major), 396, 405, 416, 420
- Chart - Weekly: Bullish - it broke through the lines/clouds it needed to. Bravo, very impressive. I didnāt think it was going to happen, but it was warning it was possible for a couple weeks. This one says hold my beer, weāre going higher.
- Chart - Daily: Bearish - getting ready to pullback.
- Chart - 4h: Bearish - overbought. This is the main one Iām focused on.
- Chart - 1h: Neutral - consolidation.
Trading Plan (Monday):
- Scenario 1: If we gap to 416, taking puts down to 412/410.
- Scenario 2: If we open below 413, puts to 410. Close out. If 410 breaks to 409, look to re-enter and possibly hold overnight to 405.
- I can only justify puts right now. Calls are off the table with these RSI/MACD conditions.
- I think Scenario 1 most likely. Scenario 2 looks like a big stretch and unlikely.
- I am going to let one SPX trade out for the entire scenario that happens and not lock in profit early. Only at the price triggers I set. Iāve been seeing too many of these scenarios play out by end of day and I was selling too early and not letting it play out.
SPY, 4h
Login to join the discussion!
Maverick's Moves
Created By: | Maverick |
Created: | Feb 8, 2021 |
Total Followers: | 13 |
Follow |
I trade SPY, QQQ, and specific story sectors using technical analysis and gut rubs.
I'll post my thoughts and market moves here.
Twitter: twitter.com/stonks_maverick
Substack: mavericksmoves.substack.com
I'll post my thoughts and market moves here.
Twitter: twitter.com/stonks_maverick
Substack: mavericksmoves.substack.com