Submitted by DaddyDersch t3_11dne3l in wallstreetbets
We are officially in the massive pre market move followed by intraday range/ chop trend… probably one of the most frustrating times to be a day trader as unless you swing (and are correct) we are left with the crumbs… Look at the massive pre markets we have had over the last 7 trading days…
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Average open over the last 7 trading days is +/- 0.83%. That’s pretty dang impressive..
Today was probably one of my favor intraday SPY patterns… the classic 123 rollercoaster.. I have talked about this numerous times but essentially a 123 rollercoaster is 1) the initial move in this case the dump from 401.29 to 398.26… 2) the recovery in this case that is the pump from 398.26 to 399.51 and then finally 3) the final bigger push past initial low… in this case that’s the EOD push to 397.2 area. Its actually really refreshing to see this pattern play out today as this is how SPY used to behave and generally behaves in a healthy market… these massive V bottoms and Massive LOD to HOD reversals are NOT the normal even though 2022 wants us to believe they are. This is healthy and refreshing to see especially on a bear trend day…
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So the question is where does this leave us?
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Despite the pretty impressive 0.9% green open and the push over 401 this morning the bears were able to capitalize once again. This honestly reminds me of the last 2 months but in reverse… how many times did we see major morning dumps and red pre markets only for the bulls by EOD to take it green or at least recover most of the loss? We are seeing the same thing here… and honestly today is a VERY bearish candle closure…
Taking a look at the daily here we had a previous demand level at 400.6 that we came up and attempted to close over today and hard rejected. Generally speaking when we have a demand level like that and we get a massive rejection it is very bearish for the future. Not only that but we kissed the daily 8ema resistance today and hard rejected it with the wick and we hard rejected the daily 200/50ema with the candle body.
The most bullish thing that we can take away from today is that we bounced off the daily 100ema support once again. However, with the demand level rejection, and daily 8/50/200ema rejection I am going to be looking for a bigger sell off here on SPY this week. My target remains 390.1, however, we do have a previous demand level at 388.66 that we could bounce off. IF we get here and can bounce I will absolutely be looking for a play back to 405.8 demand.
Current demand levels= 388.66 and 405.81.
Key SPY Support- 397.7 -> 396.4 -> 395.4 -> 393.6 -> 391.5
Key SPY Resistance- 400 -> 401.7 -> 403.2
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The futures candle with this hanging man candle with a beautiful daily 8, 50 and 200ema rejection screams downside to me. However, there IS a double bottom here off 3975. Bears need to break through that level tomorrow and more importantly close under that level.
I am targeting 3920 support bounce on futures. If we are able to get there then I will 100% be looking for a bounce back to the 4000s.
Key Futures Support- 3975 -> 3965 -> 3945 -> 3920
Key Futures Resistance- 4000 -> 4020 -> 4032 -> 4055
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So Tesla investor day is on Wednesday apparently at 4pm… I thought about it over the weekend and thought some lotto calls for investor day to let ride would be a great play and well that turns out to be absolutely correct. However that ship has far sailed… a day too late for sure…
Taking a look at tesla here we had that really nice hammer candle doji that also re-established 196.3 as demand on Friday. That led to a pretty massive bounce and yet another gap to the upside. We also have no held the daily 8ema as support and have closed over the 202.1 resistance it fought at all week.
Our next demand level is 211.5 and that is where I will be keeping an eye on for this week and tomorrow. There is a very real buy the rumor sell the news potential with Tesla this week.
Demand levels- 196.3 and 211.5
Key Tesla Support- 205.1 -> 202.1 -> 197.8 -> 196.3
Key Tesla Resistance- 207.9 -> 211.6 -> 214.2
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The VIX was pretty much all over the place today. Despite the VIX pretty much dropping from opening this morning it did have a bounce off the daily 8ema which at the same time provided a downside opportunity for SPY. The one interesting take here is that SPY did NOT recover despite the VIX continuing its sell off. Watching the VIX continue to unwind while SPY falls is something very important to take note of.
Daily log-
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Started the week off really nicely today. I am pretty happy with the day overall and I am even okay with the two losses I took. The first loss was on a potential breakout that ended up with a massive 50cent plus blip down that of course no one could have expected. The second loss I ended up cutting my put early when we broke through a key resistance. It would have ended up coming back to be extremely profitable, however, while I didn’t watch it the whole time I believe my -10% stop would have hit first.
I did move up to a -10% stop this week officially and went live with that. So far so good obviously. It is definitely nicer knowing 2 nice wins breaks me even instead of 3 nice wins. However, will continue to evaluate as time goes on. So far so good and positive results there.
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