It's "Roll Day" for Index Futures | Trading NVDA, QCOM & More

Let's see if the markets can hold onto the recent gains (and perhaps rotate higher)

Wednesday is exactly what the doctor ordered. Back-to-back days of strength in the S&P 500 put bulls back in control, vaulting the index back over last week’s high and all of its short-term moving averages. Breadth was robust during that two-day stretch. 

Earlier this week, we said it would be a tall task to clear these measures and it was. If the S&P could do it though, we said it would put the all-time highs back in play. Technically, that remains true too.

Breadth was pretty solid yesterday, given the “digestive action” we had.

Technical Breakdown 

• NYSE Breadth: 65.3% upside volume

• NASDAQ Breadth: 72.7% upside volume

We do have some potentially choppy events to navigate, starting with today’s “Roll Day.” Next Friday is quad-witch expiration, as well. The latter can lead to choppy price action early in the week too. 

Keep these things in mind if you’re a swing trader, as this type of price action tends to frustrate investors. 

S&P 500

SPX Daily | Click to Enlarge

Monday’s action gave bulls hope, while Tuesday’s action left little doubt in investors’ minds about which side was in control. 

Yes, the index can try to make new highs and fail, but if bears really had control, they would have kept the trend in their favor. 

On the upside, the task at hand is clearing the 4810 to 4820 area. If it can do that, the ~4844 high is on the table. On the downside, let’s see if we can close above 4673 — giving us a weekly-up close.

QQQ

SPX Daily | Click to Enlarge

The QQQ has also had a few strong days, but has yet to go weekly-up. That’s likely as it’s had more selling pressure overall in the correction (just look at growth stocks). 

If the QQQ can go weekly-up over $401.19 and close the week like this, it will be an impressive feat for the bulls. That said, we’re currently working on an inside week, (with this week’s range completely contained within the prior week’s range).

I noticed that in a lot of growth stocks during my nightly scan, too. 

This could set us up for an inside-and-up rotation next week, but let’s not get too ahead of our skis. For now, I’m watching $401.19 and $401 resistance on the upside, and the 10-day and 21-day moving averages on the downside. 

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Individual Stocks — NVDA, QCOM, DHI, COST

In all, it’s been a quiet stretch as far as individual stock setups, but it’s been fairly rewarding. Our trade in ARKK has done fantastic and has some traders wondering if we just caught the bottom. We’ll see as time goes on, but we have a lot of cushion on our trade to find out. 

Even just yesterday, we knew to be cautious of Semiconductor stocks even as I like the group as a whole and as it’s been a relative strength leader, along with housing. So I think the navigation has been pretty clean!

Let’s get started with Nvidia.