Great Action From Friday. Now What?

Plus a note on GE, please read!

Technical Edge — 

• NYSE Breadth: 84% Upside Volume (!)

• Advance/Decline: 78% Advance 

• VIX: ~$20

Great action on Friday from a price perspective, although the Adv/Dec. was not as strong as some would have thought. 

Ultimately though, we did get the options squeeze we were looking, turning Friday into “FRY-day.”

Now though, the S&P still sits below last week’s high (and the prior week’s high), as well as several resistance points. It “feels” like we’re out of the woods when you scroll through FinTwit, but that’s hardly the case on a technical basis.

That’s not to say the bulls can’t get out of the woods; it’s to say that they are not out of the woods, yet.

Here’s how that happens:

(And PS). We flagged a trade on GE on Friday. It’s working well, but the company reports tomorrow morning. More details in the “Open Positions” tab, but be sure to be trimmed down or out ahead of the event. Cheers

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S&P 500 — ES

daily, weekly

Friday was a great session for the bulls, as the S&P held the 3900 to 3920 area and charged higher. But let’s not forget the difficult couple of days that led to this session. 

Above shows the daily chart on the left and the weekly chart on the right. The ES is still below the prior two weeks’ highs, as well as downtrend resistance and the 50-week moving average (which has been strong resistance). 

While it’s working off a higher low — which is bullish — I think we need to keep in mind that this is still a market in a downtrend and patience is key!

If the ES can take out the 4030 to 4050 area, we could be looking at a much better move to the upside. 

SPY — Zoomed In