Happy Tuesday Traders.
It appears markets have gone pretty quiet waiting on FOMC news tomorrow. This is to be expected, no one wants to be on the wrong side of the news. Especially with something as powerful as rate news.
I suspect today will again be a quiet day. Unlike yesterday, I am looking to engage in a few positions today if the opportunity arises. First lets take a look at the general market.
The SPY is just sitting out up here on its monthly POC and building out a bit of a higher volume area around 454. This is all relative of course as its summer trading and the volume up here has not been great. I am still looking for a ~10 point sell off to the 445 range to start to get active in the SPY again.
I am not a huge fan of chart drawing but there is certainly a wedge forming on the VIX. If we break out to the upside then I could see us back in the lower 20’s pretty easily. That would probably be enough to shave a few hundred of the ES and a similar % change on the SPY. Perhaps more than likely though is that we will continue to chop around down here and do nothing until summer trading is over
Thanks for reading The Weekly Raid! Subscribe to receive daily updates and trade plans
Here is my trade plan for the day, I am looking at tech today. The Q’s have come back into its monthly POC and is sitting on a longer term LVN. I think this could be a solid location to start looking at its component parts for trades.
Tesla had a fantastic day yesterday with a 3+% move off the previous months POC. It would have been a fantastic trade location and was talked about in this weekends post. But I missed the trade. I think there is a possibility we see 280+ on this but the easy trade is gone as far as I am concerned. So I will wait for another location for a trade.
A historic trade for me has been the Run into earnings trade on tech. I am not sure I will place this on Apple through the equity, but I am looking at Call spreads to help offset some of the risk. This month looks pretty balanced so far but there is some unfinished business at the top of the longer term VBP. I think a poke to 200 before earnings is possible.
Amgen is not a particularly popular name to trade. But its fairly liquid on the underlying and if you pick the correct strikes the options will be fairly liquid as well. The spreads a re pretty wide though, so this is not for the faint of heart. One think I did notice about this one was 16k calls trading in the August Monthlies. That’s pretty unusual volume for that name. I am keeping an eye on that strike as all of that action stuck to open interest, just something to watch.
Price wise I think its possible to see the 242-245 mark in short order if buying continues. One thing that I don’t like on the chart is the high block of volume and the lack of movement to accompany it. Will be watching this to enter into calls at some point, but another solid option would be Put spreads to collect premium.
That’s all I got for today.
As always trade safe