CONSOLIDATING AFTER THE RIDE - After multiple upside breakouts in the past 6 months, including breaking a previous historical high, the S&P500 currently seems to be in "waiting" mode but with a long bias, trading between its 50MA and 100MA ranges.
FUNDAMENTALS ON HOLD - Last week was mostly about waiting for the Fed to speak (bear flag), until a rather dovish central bank took the market higher (Fed relief). This week is mostly about the upcoming US presidential debate and OPEC meeting. Earnings season also starts next week. Expect this uncertainty to bring some volatility.
TECHNICALLY: LITTLE CONVICTION - While the bear flag was invalidated towards the end of last week, it did so with only mild confidence - The index remains above the top of the flag but below its 50MA. Short bias below 2160. Long bias above 2165.
TRADING CONCLUSION - I would refrain from trading the index until we get a better directional indication, hopefully this week.
FOR THE BULLS - Die-hard bulls would want to purchase SPY Oct 21 219.50 calls and pay a small premium (0.85 cents/share = 0.39%) to get exposed to a further breach of the most recent historical high, with minimal risk.
FUNDAMENTALS ON HOLD - Last week was mostly about waiting for the Fed to speak (bear flag), until a rather dovish central bank took the market higher (Fed relief). This week is mostly about the upcoming US presidential debate and OPEC meeting. Earnings season also starts next week. Expect this uncertainty to bring some volatility.
TECHNICALLY: LITTLE CONVICTION - While the bear flag was invalidated towards the end of last week, it did so with only mild confidence - The index remains above the top of the flag but below its 50MA. Short bias below 2160. Long bias above 2165.
TRADING CONCLUSION - I would refrain from trading the index until we get a better directional indication, hopefully this week.
FOR THE BULLS - Die-hard bulls would want to purchase SPY Oct 21 219.50 calls and pay a small premium (0.85 cents/share = 0.39%) to get exposed to a further breach of the most recent historical high, with minimal risk.
评论:
Although we are technically above the bear flag resistance, we are still stuck below the 50MA. This upside breakout is unconvincing for now. Current SPX strategy unchanged: Do nothing until we get a better directionality.
We are now back in the bear flag, and the market is feeling "heavy".
Awaiting proper breakout before taking any action on the index.
My sentiment is turning bearish, though.