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Monday March 24th
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““Don’t ask what the world needs, ask what makes you come alive, and go do it. Because what the world needs is people who have come alive.”
– Howard Thurman
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Happy Monday ladies and gentlemen!
Last week was extremely tight and range-bound on SPX. We had three tests of the 200DMA.
Three attempts — three rejections. On the high end, the 2714 or so mark will continue to be resistance this week. On the low end, 5522 will be support.
VIX sold off from its high-point of 27 or so. Not only that, but we’re done with OPEX for the quarter. This should open up the price action for at least another month. What’s really important is to watch the next three days. With VIX dropping, any trend that forms by Wednesday or Thursday should form up into a pretty good indicator as to where markets will head for next thirty days.
This AM, Trump announced that he may limit some of the tariffs that were planned to take effect on April 2nd. This is just rumor mill so far, but markets are up big pre-market on the news.
JPY/USD
The yen is down. Which should be bullish for equities today.
Onto some ideas for the week…
TALO
The energy sector is having a bit of a rebound, led by the big names like Exxon and Occidental. But TALO is another company that I don’t hate. We’ve had a 9/20 crossover, accompanied by a nice little trend signal on the Aroon. I’m looking for Talos to break over the $9.21 mark. If that happens, I might look to go into the 16 MAY 25 $10 CALL options that are trading for just $0.10 right now.
OXY
Speaking of Occidental, there might be something here. We have the 9/20 crossover, and a bit of consolidation pattern that formed at the end of last week.
The price bounced up beneath a volume shelf of around $48. Should it break over that, I will be watching the 17 APR 25 47.5 CALL options.
BA
I’ve been harping on defense stocks for awhile. Mainly European defense companies, but also American companies. Late last week, Trump and Hegseth announced the next-generation F-47 fighter jet. Apparently, it’s already been flying missions. Boeing was the designer of the jet, so the stock is getting a little bump.
There is some volume support at the $180 level. That would be the near term price target. Should we hit that, the 16 MAY 25 $180 CALLs could pay off nicely. Thought they are a bit expensive.
MELI
Mercado-Libre is the Latin American combination of China’s WePay plus Amazon. It’s a payment processing company, and ecommerce titan.
This is my iffiest play of the week. I do see support at $2,011. Should that hold, we could see MELI hit $2,188 or so over the next couple weeks. The options are expensive, but the 17 APR 25 2100 options could be decent if the support holds.
That’s it for now!
Talk to you all later.
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Testimonial of the day
Nathan W. about the Wave Indicator:
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To Better Trading,
Alex Reid
