How AMZN and AAPL Impact the Tape Today
S&P 500 is sitting in no man's land as we wait for end-range tests.
Technical Edge —
NYSE Breadth: 79.2% Upside Volume
NASDAQ Breadth: 71.8% Downside Volume
Game Plan
In light of the volatility right now, I’m super pleased with how the S&P has traded the last few days. Traders have been able to pull a total of 100+ points out of the ES from the opening fade over the last two days. The short SPY trade has been killer in those two days too.
The TLT trade is now set with a breakeven stop, as we said to book some gains on yesterday’s gap down.
Despite a faster tape, we have been moving slower and that’s really important right now.
S&P 500
Today’s tough. Not only are we navigating AAPL and AMZN’s impact on the tape, the ES is 70 handles off Thursday’s high, but up 100 handles off this week’s low. We’re kind of in no man’s land right now until the market decides where it wants to go.
On the downside, let’s see if the ES retests 4220 — yesterday’s intraday breakout spot and the 50% retracement of the move off the low. Below that, 4200 is in play, which is the 61.8% retrace of the move and a notable intraday level the last few days.
A dip/reversal off these levels could be a buying opportunity. A break lower puts 4185 in play, then 4150.
On the upside, watch 4280 to 4285. That’s the Globex high and yesterday’s close. If we rally there and fail, it’s a potential low-risk short. If we power higher (which is actually the setup I prefer), ~4300 looms large. That’s yesterday’s high, the declining 10-day and this week’s high, and combined, could act as resistance.
AMZN and AAPL will be key to the upside. If they can’t rally, they will act as anchors on the market.
Individual Stock Trades — PG, PANW, MCK and DOW
PG and PANW are longer term setups on the weekly.
MCK and DOW are setups for today that will need the market to cooperate.
PG
Defensive stocks have been doing well lately. PG is probably a “no trade” today, but keep this one on your radar for next week as it’s setting up with an inside week just below $165 resistance.
PANW
Similar deal in PANW. Inside week thus far as it consolidates above the 50-day but under $600 resistance.
If the market crumbles and this goes weekly down, perhaps we see $550. If it goes weekly-up (my preference), then PANW could see $620 to $630 as a potential trim zone.
A rebound in tech could bode well for this name, which has had a lot of relative strength.
MCK
We have hit this one up a few times for a nice profit. Now let’s see if it can go daily-up over $321.80 - $322. Important: It needs more than just a wick above this area, it needs to clear it and hold above it!!
If it does, $326 to $327 is our first trim spot, followed by $335.
If it triggers, our risk is yesterday’s low. Aggressive bulls can use $311.
DOW
Post-earnings flyer. Daily-up over $68.10 is our trigger. That puts $69.50 to $70 in play first, then $71.50.
If it triggers, our risk is yesterday’s low.
Go-To Watchlist
*Feel free to build your own trades off these relative strength leaders*
Numbered are the ones I’m watching most closely. Bold are the trades with recent updates.
A huge number of our B/E stops were hit last week, leaving us with virtually no trades left on the books. Some runners may be in play with WMT and TGT.
TLT — Trim spot hit, down to ½ or ⅔ position and B/E stop → Looking for $119.50 to $120 as next trim zone.
WMT — Trim at $158 → B/E Stop.
Relative strength leaders (List is cleaned up and shorter!) →
AR
PEP
KO
MCK
BMY
JNJ
DLTR
DOW
VRTX
XLP — Consumer Staples
PG
COST
MAR
PANW
Economic Calendar
