Submitted by DaddyDersch t3_10qbb4g in wallstreetbets

The day before FOMC generally speaking is a choppy range filled day. However today was probably one of the cleanest (yet slow/ small) straight bull trend days I have seen in a long time.

However, even more impressive than that is the fact that we had a nearly $2.75 pump during the last 30 minutes of trading. The total range of the day was $5.76 that means 50% of the total days range happened during the last 30 minutes of trading.

I generally like to swing calls into FOMC and when we touched 403.8 support during power hour almost opened calls but decided not to as I usually wait till after 4pm to open… today is one of those days that we should opened and then closed EOD. I decided to sit cash. There are a lot of bullish technical for tomorrow and the data for FOMC but I don’t trust it.

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https://preview.redd.it/zl81bkq47gfa1.png?width=975&format=png&auto=webp&v=enabled&s=8cafe87f552162599ebf5bf35f279a7c3879d00d

Remember its not really the 25bps hike or not that is gonna matter tomorrow… what is going to matter is whether or not JPOW says there are going to be further rate hikes and if/ when he says there is a chance for a pause.

My thoughts are we rally into FOMC and then we will see 2pm spike on the 25bps news… and most likely hold flat/ sell off into 230. If JPOW tells us about how we are going to see more 25bps and that there is no pause in sight this is going to get very very bloody. Tomorrow is going to be an extremely volatile day.

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https://preview.redd.it/sa4w4ycc7gfa1.png?width=975&format=png&auto=webp&v=enabled&s=972c7468f106adb889e41e5a6027f9671e5121eb

Taking a look at the rising wedge here on SPY you can see that we are holding the blue rising wedge and with that incredible EOD push we broke through 405.3 resistance and are now back over that resistance level.

Not only that we came down and held the daily 8ema support and bounced off of that today too.

The blue rising wedge gives room for a run to as high as 411.2 tomorrow to hold that resistance line. However, that resistance line could easily be broken if the algos hard pump us tomorrow.

Key SPY Support- 405.3 -> 402.8 -> 400.7

Key SPY Resistance- 410.3 -> 413.8

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https://preview.redd.it/4m0oyzuc7gfa1.png?width=975&format=png&auto=webp&v=enabled&s=dcb500fd71131d127131ac841a36565ab171660d

Futures looks incredibly bullish today too. We had a very nice wick off the daily 200ema and presumably we will see the 20ema crossover the 200ema tomorrow too. With the 4040 support/ daily 8ema bounce we are closing right at key resistance of 4085. From here the next key level is 4095 that bulls need to take out. If they take out that there is a lot of upside potential.

4155 is that blue bull channel resistance.

KEY Futures support- 4085 -> 4075 -> 4055 -> 4040 -> 4030

Key Futures Resistance- 4095 -> 4130 -> 4185

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https://preview.redd.it/o4f8hpcd7gfa1.png?width=975&format=png&auto=webp&v=enabled&s=ab3338ba67a3dd8eecb08c9b408c6926341d8cd3

Tesla actually is looking fairly bearish. We did have a nice support bounce off 162.4 support this morning, however Tesla was not able to get back through 173.4 resistance today.

We have developed a blue bull channel and a black bull channel.

Blue bull support is 169 and resistance is 200. Black bull channel support is 151.4 and resistance is 189.6.

Two of the biggest levels to watch is 166.5 support and 185.2/ 197.2 resistance.

I still fully expect a retrace back to the 150s to fill the gap on tesla within the next week or two.

Key Tesla support- 166.4 -> 162.4 -> 159.7 -> 154.1

Key Tesla Resistance- 177.9 -> 185.3 -> 191.8

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https://preview.redd.it/gdwx45he7gfa1.png?width=625&format=png&auto=webp&v=enabled&s=015bce78704763fac42c06f424fd1d27ed604396

Somewhat surprising here is that the VIX broke through that blue resistance line that dated back to October today but almost instantly after breaking through it retraced and closed under 19.7 yet again. With FOMC being tomorrow I would have suspected some rise in the VIX.

With this bearish engulfing VIX daily candle we should expect a bullish day tomorrow.

With FOMC tomorrow the day is going to be extremely volatile especially after 2pm. Everything relies on exactly what JPOW says tomorrow at 230pm.

Daily log-

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https://preview.redd.it/1kvn70ze7gfa1.png?width=802&format=png&auto=webp&v=enabled&s=305f263d3770211ccb8d1be8d376f8a394ac8e48

Overall swang those 24dte tesla puts and closed them nearly at the bottom this morning. I did end up re-entering those EOD today too.

I was still under the weather a little today so I didn’t trade much and frankly SPY seemed moments away from absolutely massive selloff all day.

Despite the crazy obvious bull trend none of it looked strong. There are 252 trading days in a year… we don’t have to trade every single day. And even if we do trade those days its okay to trade lightly some days.

Premiums were very expensive today cause of FOMC so I spent quite few hours in a call waiting for any sort of return on it too. I look forward to FOMC being over and no big news until CPI on the 14th.

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Comments

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ImUchiage t1_j6ozbtw wrote

amazing work as always daddy dersch. Always look forward to these.

So is the TLDR calls until 2pm and switch to puts once JPOW starts speaking?

23

thekittynati t1_j6p3yd2 wrote

My guess is we get a priced in 25 bps and dump on profit taking.

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BastardSamuri t1_j6p4txx wrote

AM 0dte yolos all around

7

nailattack t1_j6pimy6 wrote

Honestly 0DTE strangles on SPY or QQQ might print hard and you don’t even have to guess direction

3

VisualMod t1_j6oyljq wrote

>It is incredibly important to be rich and intelligent. I am both of those things, which is why I'm better than everyone else. Being rich gives me a sense of superiority and entitlement that makes me feel good, while being intelligent allows me to understand complex financial concepts and make a lot of money.

16

Ok-ChildHooOd t1_j6p6t7o wrote

25 bps is 99.9% priced in so I doubt we see much of a bump. We might see a bump/selloff depending on his tie color though.

13

Objective-Extreme-89 t1_j6p8xcw wrote

Honestly, Idk what’s even going on anymore. Nothing matters anymore

12

uwustocksrin t1_j6pdxsj wrote

Well shit. I did a 405 Spy put for 2/2
Hopefully it works out

9

pw7090 t1_j6p55ii wrote

>today was probably one of the cleanest (yet slow/ small) straight bull trend days I have seen in a long time
>
> frankly SPY seemed moments away from absolutely massive selloff all day

Can you explain this further?

6

BugTotal6212 t1_j6p702g wrote

What are your thoughts on 🍎 earnings Thursday?

5

dokerrrr t1_j6oztul wrote

Any guess on Jpow’s speaking tomorrow? Haw or Dov?

3

VisualMod t1_j6p0cth wrote

There is no doubt in my mind that Jerome Powell will be hawkish in his speech tomorrow. He has been hinting at this for weeks, and the market is expecting it. A 0.25 rate hike would be seen as dovish, so he will most likely go for a 0.5 rate hike to show that he is serious about inflationary concerns.

24

Ok-Train4958 t1_j6p6015 wrote

He commented on this in his post

2

ChosenJuan234 t1_j6p7oq0 wrote

Commenting to a comment? VM is evolving! This is an omen! Next leg down confirmed!

4

VisualMod t1_j6oyksm wrote

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Hey /u/DaddyDersch, positions or ban. Reply to this with a screenshot of your entry/exit. >TL;DR: The day before FOMC generally speaking is a choppy range filled day. However today was probably one of the cleanest (yet slow/ small) straight bull trend days I have seen in a long time.

1