Opex Is Here. Taking Profits on Recent Trades

S&P quietly had its worse session in almost a month.

It’s really been an interesting trade over the last few weeks. We’re going into Monthly Opex today and the earnings engine is starting to fire up. So far, we’re not getting that great of reactions — aside from the big banks. 

Is it time for the money to rotate out of tech and find a new home? Last week we noted the strength in defensive stocks — like MCD at all-time highs, PEP, KO, PG etc. — and yesterday’s post was littered with picks in the healthcare space, which has been hot as well. 

The direction of tech will really be determined once FAANG starts reporting, but the reaction from NFLX and TSLA was uninspiring to say the least.

Technical Edge — 

• NYSE Breadth: 26% Upside Volume 

• Advance/Decline: 36% Advance 

• VIX: ~$17.10

We had a lot of setups yesterday, so I’m going to spend more time managing and talking about those than looking at new setups. Let’s keep today super simple and not look at too many setups. Opex days are notoriously choppy and difficult to trade. Let’s see if this ends up as one of them. 

S&P 500 — ES 

The ES held the 4140 to 4145 area, then held the 10-day after a late-day jump. 

• Key Pivot: 4175 to 4180. 

• Upside Levels: 4200, 4217-25, 4240-45

• Downside levels: 4137-4140 + 10-day, 4115, 4095-4100

SPY

$415-16 resistance is clear. Let’s see if the SPY can hold yesterday’s low of $410.27 and the March high at $409.70. 

• Upside Levels: $415 to $416, ~$418.25, $421

• Downside Levels: $410-ish, $407.50, $405.50 to $406

SPX

Doji-candle the day before Opex? Why am I not surprised? 

• Upside Levels: 4150, 4163 4172-75, 4195-4200

• Downside Levels: 4110-12, 4091, 4070-75

TSLA

This is for aggressive traders only, but I am looking at TSLA to see if it can regain the March low near $164.

Specifically, I’m looking for an open below this level, then a move up through $164 to get me long, with a stop-loss around $160.

This is a cash flow scalp for me, so I’m looking to get paid by trimming early and often, likely in the $165-$166 area, then $167.50-ish. If we clear yesterday’s high near $169.70, we can look to trim down more and possibly swing trade a partial position.

Open Positions 

• Bold are the trades with recent updates. 

• Italics show means the trade is closed.

• Any positions that get down to ¼ or less (AKA runners) are removed from the list below and left up to you to manage. My only suggestion would be B/E or better stops.)

• ** = previous trade setup we are stalking.

1. AAPL — for those that were swinging AAPL for the longer timeframe, we got our $165 area to trim into and as we continue to tip-toe higher, I’d say down to ½ size here or even less. 

   1. Going for $168.50 to $170 on the next tranche. Raise stops up to $160. 

2. GE — long from ~$94.50 and got our $100+ target. Down to Runners. 

3. AMD — Long from $88.50 — $92 to $93 is ideal first trim, ⅓. $95+ is the second target. 

   1. I’m using $87 as my stop-loss, but you can admittedly go tighter than that and/or use a B/E stop.  

4. **DIA — 10-day ema may be a worthwhile dip buy in the DIA if we see it today — If took, look to trim on any NHOD, then $339.50 to $340. Stop can be a 30- or 60-minute close just below Thursday’s low.

5. ABBV — long over $161.50 — Target $162.50+ for first trim, $163.25+ to get down to ½ position. 

   1. Stop at $158

6. CAH — long from $79 as a scalp vs. $78.50 low — $80 was a trim spot (resistance). Now Breakeven stop, fish for $80.50+ to get down to ½ or less. 

7. LLY — Long from daily-up over $370.50 — ⅓ trim at $375+ as per plan. 

   1. $377-78 is next trim spot, followed by $380-82. Breakeven stop.

8. **XLV — no daily up trigger — but can adjust entry down to a rotation up through Thursday’s high of $133.60. 

9. **BRK.B — look for a test of $319-ish and the 10-day ema. That’s a Buy-the-Dip setup in my view (setup from Thursday). 

Go-To Watchlist

*Feel free to build your own trades off these relative strength leaders*

Relative strength leaders → Tech remains absolutely the strongest group lately.  

1. MCD, PEP & KO, WMT, PG — XLP

2. ABBV, LLY — XLV

3. NVDA, AMD 

4. MSFT, AAPL, META

5. PANW, FTNT

6. FSLR

• AQUA

• GE

• DKS, ULTA

• LMT, RTX

• GOOGL, AVGO

• ULTA & LULU

• MELI

Economic Calendar

Disclaimer: Charts and analysis are for discussion and education purposes only. I am not a financial advisor, do not give financial advice and am not recommending the buying or selling of any security.

Remember: Not all setups will trigger. Not all setups will be profitable. Not all setups should be taken. These are simply the setups that I have put together for years on my own and what I watch as part of my own “game plan” coming into each day. Good luck!