The Bear Setup Is Valid, The MACD-v Extreme Says Otherwise

The market quite literally went meteoric. Well, the S&P and Nasdaq did, basically on the back of less than a handful of tech stocks. The Dow and Russell were obviously excluded from the party and don’t seem to be that bothered by the tech bro pump.

Right then, let’s get into the charts.

Market Snapshot

Two indices left the atmosphere. The other two stayed in and did the washing up.

• SPX 7,771.48, up 114.20 (1.49%). A fresh low scored setup has been taken. Full read below.
• RUT 2,875.36. Still in bull mode. Full read below.
• BTC 85,418.38. The breakout romps away. Full read below.
• ES 7,825.25, down 4.00 (0.05%). A small favourable movement overnight.
• NazQuack (NQ) 30,761.50.
• Uncle Dow (YM) 52,344, down 109 (0.21%).
• Uncle Russ (RTY) 2,889.2, down 9.6 (0.33%).
• Gold 4,340.1, down 40.9 (0.93%). No read today.
• Crude (CL) 93.11, up 1.14 (1.24%). No read today.
• VIX 14.81, down 0.05 (0.34%). Ticking lower, after spending yesterday quietly counting the exits. It was actually attempting to move higher yesterday throughout this rise, once again giving some clues to the underlying weakness and market jitters.

SPX – A fresh low scored setup, taken into a MACD-v extreme.

Over on the swings, SPX gapped higher at the open as we thought, tagged the upper Bollinger band as we thought, and then galloped off to the far side of the moon to check for aliens! With barely a 30 min bear bar until the last hour, when the Tag n Turn finally appeared for a little bonus point, took out a prior swing high, which I’m sure will have the liquidity sweep bros salivating.

Technically this is also a breakout, so a push lower will develop the pullback element on the daily charts…

That said, a fresh low scored TnT setup has developed which has been taken. Thankfully, due to the Global trading, these last bar of day setups can be taken with ease. Overnight there is a small favourable movement.

With the MACD-v extreme there is the higher expectation of a continuation. The bear setup is valid, and the conflict is the MACD-v extreme, so a bear failure will lead to a strong bull continuation.

As always, we will see when it happens.

RUT – Simpler to read, and still in bull mode.

RUT continues to be simpler to read. Yes, it’s still in bull mode as we thought would happen yesterday.

Given the meandering, the upper BB has contracted closer to where current prices are, making the upper BB TnT a possibility, whereas yesterday it seemed a long way away.

A bear setup will still be, for the moment, the current bull failure.

Right now just waiting for the profitable conclusion of the bull.

Crypto, BTC – The breakout romps away quite nicely.

Bitcoin’s breakout romps away quite nicely, stalling at breakout target 1 around the 86,000 level.

With the way price moves on BTC when it gets going, target 2 at around 91,000 could be also soon. These are just multiples of the range height.

Target 2 could be also soon.

The Premium Poppers – Some great and fast wins on SPX.

And of course yesterday’s premium poppers saw some great and fast wins on SPX.

I personally took a few unofficial trades on SPX and RUT which worked out nicely, 430 on the SPX and 265 on the RUT, both at expiration.

And the community once again pulled out some great wins.

Don E. was busy. He sold the 7705/7700 put spread at $2.40 and transformed it into a 7700/7705/7710 butterfly to lock $.60. He also closed an SPX Bull BO1 for $.50, and took a small SPX LP BO at 11:10am. In his own words, he “locked in $.60 on butterfly; took 50% on BO1 and let LP BO expire well above strike price.”

Awesome work. Despite this market continuing to go up, it’s not been a bad day at all.

RJ M. was “out of SPX Popper at a little better than 50% of premium (but didn’t get a dollar since being cautious still with low volatility).”

Scott K. had the day mapped out already: “I was going to be out most of the day, so took the 1st BO on SPX and transformed right away to lock in $3.46 profit with a chance at a bullseye. Closed in a different universe from my target, but that’s OK.”

The community once again pulled out some great wins.

Meme of the Day: