Monday, January 13th
The best way to play Trump-atility before the inauguration!
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“Every word has consequences. Every silence, too.”
– Jean Paul Sartre
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Hello traders!
As you’ll see, the levels established in the Telegram channel for SPX have largely held thus far:
We will see how much the SPX recovers today — I am expecting the SPX to finish in the green today after such an illustrious sell-off last week. The yellow and red lines will be the levels throughout the week this week, and we’ll see where we stand at the beginning of each trading day.
Sidenote: Are you adding Anchored Volume Profile to your TradingView charts? If not, you should be. It’s how I establish price shelves and price deserts. I can talk about that in more detail at a later date.
It’s a pretty risky news week this week. Tomorrow is PPI, Wednesday is CPI, and Thursday is initial jobless claims, and Friday is housing starts. I expect the inflation reading to come in hot. Initial jobless claims will be interesting considering that the labor market came in so hot last week. Regardless, each of these events could send the market whipsawing, so be prepared.
Let’s look at some setups for this week.
JBLU
The airline company came in with good earnings last week. I’m liking the setup, we have a consolidation pattern forming on a bullish trend. You could also argues that it’s a triangle pattern as well.
There’s a volume shelf at $7.02. No trade yet, but I’m going to be watching this to break above that upper line of triangle. If it breaks below volume shelf, puts may be called for.
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Hey! This is a huge week in the markets with a few dangerous signals I’m tracking. Join me today at 12 PM EST for my exclusive “Monday Market Live Stream” And I’ll share what I’m seeing – plus a huge opportunity for later in the week. Join me here at 12PM EST.
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NVDA
NVDA is getting hammered by Biden chip export controls.
We’re in sell off mode on this baby. I see a little bit of support at $127. So, if we hit that level and bounce, well, I would be looking for NVDA to regain into $137 territory.
Yields
The 10-year keeps climbing!
Longish term, I could see yields hitting 6%. The markets will be a disaster if this happens. No reason to buy stocks when safe U.S. treasuries will pay out 6% per year. This could be a big week for the bond market with all the news coming out.
CHWY
No matter how bad the world gets, people will still love their pets. Nobody has children anymore, instead pouring their love into their fury companions. You don’t have to pay for college for your cat, simply get them a little mouse toy once and awhile.
A good ascending channel is forming. I like the 28 FEB 24 $39 CALL if it can be had for under $1.50. It’s $1.59 right now.
DXY
The dollar has surged to the highest level since 2022.
This is bad for the markets. With a rising dollar and rising yields, it gets harder to service existing dollar debt. Sovereign nations must sell holdings (stocks, crypto, gold, etc) to pay back their debt. This can cause every other asset to sell-off. This is dollar-wrecking ball theory.
All other world is indebted to U.S. One theory is that we will try to crash global economy to send everyone into tailspin. The idea is that even if U.S. is economically harmed, we will be the best of the worst. And once global economy is in deep recession, people will flee to safe haven U.S. treasuries, allowing us to lower yields and inflate away debt.
We will see if it works.
But DXY $110 is a key level. If it goes higher….fireworks!
To Better Trading,
Alex Reid