The Bull Made It 2 Days. 7820 Is Next, and I Still Don’t Need to Be Right.

It’s Phil. Day 2 of actually getting my opinion right. The birds are tweeting, well, they would be if Storm Boelo wasn’t blowing a force 8 gale with the rain coming down sideways. The world is spinning normally, albeit a little faster for the same reason. The coffee smells great, the setups are pulling in the premium, and my opinion was spot on for the second day running.

All is right with the world for the moment!

As I keep saying, we don’t need to be right to make money, we just need to put the damn trades on as per the system rules, but it is nice when opinions and systems align. It does dampen the frustrations surrounding market conditions, or what I expect market conditions to be like and do and behave.

Anyway, slurp, the coffee seems to taste a little better today.

Scroll down and I’ll show you what’s holding up under the gale.

Market Snapshot

Over on the snap market view we can see that prices on the S&P and Naz are pushing off the range lows. VIX is falling, the fear that everyone had or has is dispersing. It is still elevated, which is good, as there continues to be some intraday range of movement, which I do like on a personal viewpoint.

• S&P 500 (ES) 7,765.00, +0.11%. Pushing off the range lows.
• NazQuack (NQ) 29,924.50. Pushing off the range lows too.
• Uncle Dow (YM) 52,459, -0.22%. Stuck, looking for directions.
• Uncle Russ (RTY) 2,824.1, -0.13%. Put one foot into correction territory like he was on a dare in a haunted house, saw no one followed and ran out screaming. Russell is attempting to move higher too and the bottom does look like it’s in after peek-a-boo’ing into correction territory.
• VIX 17.58, +0.40%. Falling, still elevated, and that suits me.
• Crude Oil (CL) $101.55, +1.35%. The triangle has grown up. See below.
• Bitcoin $81,392. Finally nudging higher. See below.

SPX – We have seen turns here in the past.

The SPX Tag n Turn system is pushing higher and near the upper bands, and holding near the mid point of the prior range we have been assessing. We have seen turns here in the past.

The PnF breakout setup we looked at yesterday has, for the moment, broken out, so a move toward the 7820 level seems likely.

A move toward 7820 seems likely.

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Daily Double Dip Swings – Two types of dips are being looked for.

On the new daily setups I’m leaning towards calling it the Double Dip, or I could swipe the name from Roadhouse (the proper one) and call it the Double Deuce. Anyway, there are two types of dips that are being looked for.

Last Friday saw the S&P setup and it is pushing higher nicely. There are setups on SPY and DIA, and yesterday NazQuack’s QQQ gave a fresh bull setup.

Last Friday’s S&P setup is pushing higher nicely.

Crude Oil – I don’t marry myself to naming patterns any more.

Crude’s small triangle noted yesterday is evolving into what could be a descending channel, and this once again highlights the reason why I don’t marry myself to naming patterns any more, other than for descriptive purposes when I’m writing or trying to explain these setups. I’m always saying things like “what could be” names, or “looks like it could be”. This is intentionally non-committal, for this exact reason.

We know for a fact price is consolidating, that is not in dispute. What is, is the name, and it doesn’t really matter what it’s called. We also know that these patterns can evolve and mutate into different named patterns, and if you keep with that name you will trade it wrong, having missed the evolution. We saw this on the way up from the $88 level.

This talks about the evolution of price action patterns. Yesterday it was called a triangle pattern, today with new information it’s called a descending channel, tomorrow it could be called something else as it evolves.

Bullish at range lows still, and I could use a simple over/under $100 level for the bull bear scenario, which I think I will do.

Over/under $100 for the bull bear scenario.

Bitcoin – Nice and simple.

Bitcoin’s plan fits on a post-it, which is one more than Uncle Dow has.

Bitcoin is finally starting to nudge higher again. Bullish at range lows, target range highs. Nice and simple.

Bullish at range lows, target range highs.

Sentiment – A confirmation, if you will.

The sentiment turn level/date from last Thursday, mentioned earlier this week, has been claimed for the moment. We have some whole index participation, which lends weight to the bullish side of things mentioned last week. A confirmation, if you will.

Whole index participation lends weight to the bullish side.

Premium Poppers and Wall of Wins – A little mixed yesterday.

The Premium Poppers were a little mixed yesterday. The first breakout bear quickly turned around, changed its mind, about faced and marched the other way the rest of the day, but can be equally quickly managed as the day’s VWAP is closed past. That initiates the VWAP Flop.

You can see this setup in one of the older programs, “At the Open”, taken from the trading stocks program we were more active with during lockdown. At the Open was the name of the stock trading program I had at the time, part of which used the VWAP, and the setup was the VWAP Flop, which is noted by the second arrow on the chart: close the bear, and an aggressive bull could have been taken, and was taken by some members. The VWAP Flop was the name of the setup.

The 2nd and 3rd BO happen at the same time in the opposite direction, which increases the score for increasing position size, if you had wanted to.

Overall net positive for the day. Two trades for me, transformed, locking in a loss, then locking in a profit. On the XSP screen the left peak is the loss lock, the right peak was the profit lock. I traded XSP as I had a lot of experimental trades on SPX and didn’t want the headache of overlapping trades and management.