The Market Continues to Hold | Trading AAPL, NVDA

Technical Edge — 

• NYSE Breadth: 71% Upside Volume

• NASDAQ Breadth: 70% Upside Volume

• VIX: ~$24

CTVA — Those who took the long setup from Monday or early Tuesday, consider exiting all or most of the position with this morning’s 10%+ pop. The stock is rallying on its ESG and sustainability report. Leaving some runners is fine, but I would even consider a pre-market exit or reduction to lock in gains. 

Overall, most stocks and the market are down slightly. That action bodes well, I think. At the very least, it gives bulls the chance to flip the market from red to green and push higher (while giving us defined risk levels to measure against). 

That opportunity is much better than opening higher and puking lower. 

Game Plan — S&P 500 (ES and SPY), Nasdaq (NQ and QQQ), AAPL, NVDA

I can’t help but think about what the market is doing here. Yesterday, the S&P and Nasdaq opened notably lower on the day and fell 1% or more at the lows. But it snapped back and closed solidly in the green.

Target again cut its guidance, just a few weeks after providing a weaker-than-expected outlook. A few weeks ago, shares fell 25% in a single session on similar news. This time it opened lower by 7%+ then almost went positive on the day. 

Microsoft cut its guidance last week and did go positive despite falling 4% at one point. Apple is holding the key level we outlined yesterday. 

So what’s my point? 

We’re seeing R2G moves; bullish price action to bearish headlines. 

Does it mean we’ve seen the low? Not necessarily. But when combined with the fact that the S&P continues to hold support and the bullish breadth observation from late-May, this price action is, at the very least, encouraging to me on the long side. 

S&P 500 — ES

Support keeps holding. If you remove the biases — long or short — the picture becomes quite clear. What’s happening right now?

The ES is holding the 4070 to 4080 area and last week’s low. After failing to break down, it went from red to green on Tuesday and almost tagged Monday’s high. A huge trade for the longs. 

Now we are looking at a potential 2x daily-up. Keep an eye on 4165 to 4170. Above that opens the door to the 4200 to 4220 area. That’s a busy zone, but if it breaks, the ES could be looking at 4300. 

On the downside, 4100 and the 10-day are key. Below that and the 4070 to 4080 area is back in play. Below 4070 is not a good look for bulls. 

S&P 500 — SPY