SPY - Conflicting thoughts
I've mainly been a bear in this bull rally the last week or two. I didn't think it would last as long as it did, but hey, patience is key in volatile markets. Waiting for your time to strike. We are approaching some mighty resistance (the red line) which will be difficult to overcome. I think today was a repeat of Jan 18, and both were exhaustion gaps (days where it gapped up at open, and then gapped down the following day) and island reversals essentially.
This week is tricky due to earnings, and may push this bull run up to touch the red line (would land around 266-268 range). If that happens, I will definitely open short positions on the SPY, feeling confident in my risk/reward setup. Until then, I'm waiting confirmation of the 262 support line. If that breaks, then the next is 259. If 259 doesn't hold, then 255 is the minimum target from there. I can't predict a retest of December lows or not. But my goal is to follow each level of support/resistance. Trade down to one, sell and let it bounce a bit, then trade the next move from there.
Be careful with earnings week. A few bad misses or strong surprises could cause even more volatile movements in either direction.
THIS IS NOT TRADING ADVICE, I'M NOT A PROFESSIONAL.
This week is tricky due to earnings, and may push this bull run up to touch the red line (would land around 266-268 range). If that happens, I will definitely open short positions on the SPY, feeling confident in my risk/reward setup. Until then, I'm waiting confirmation of the 262 support line. If that breaks, then the next is 259. If 259 doesn't hold, then 255 is the minimum target from there. I can't predict a retest of December lows or not. But my goal is to follow each level of support/resistance. Trade down to one, sell and let it bounce a bit, then trade the next move from there.
Be careful with earnings week. A few bad misses or strong surprises could cause even more volatile movements in either direction.
THIS IS NOT TRADING ADVICE, I'M NOT A PROFESSIONAL.
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