Weekly Raid #54: September to Remember
Happy Friday, traders.
It’s week-end, month-end, and quarter-end. It was a September to Remember.
Before I completely inundate you with charts (polar opposite of yesterday), today’s action should be exciting: PCE data release, and quarterly options expiry.
As with anything in this business, there certainly are expectations to the rule; but seasonality held exceptionally strong this September. While we would never choose trades based solely on this data point- correlation here definitely was in favor when considering short equities.
Source: Markets & Mayhem
Below data is not as expansive- only 1950 until 2014 but wanted to find some data that focused on the second half of the year.
Switched platforms here for simpler charting to drive the point:
News of the Day
Hopefully you made it to the meat of today’s message. Even with VIX crashing the past two days, there is plenty of news and flows to facilitate a volatile Friday.
Oil experienced a significant drop yesterday, but a large portion of the move had been completed prior to open at 09:00 EST and I did not participate. Need to see footing around 90 - 91 for this this strong trend to continue.
Yesterday we took a gander at the Nasdaq TPO to see what context we could gather when gauging intraday action. As a follow up lesson, Steidlmayer would overlap today’s action with yesterdays. Today’s A period opened, tested yesterday’s value-area-low (yellow arrow), rebid this test in C period, and never looked back. One extreme challenge of the day was the retests of the initial balance A-B, when C got back into range. Keeping in mind that taking probabilistic areas is never certain, today’s read was certainly not straight forward. However, a good tip off of momentum was the inability to break the rebid area and initial balance low — the sellers of yesterday’s lows are still trapped, and the market moved away from them with conviction. They day finished with both volume point of control and time point of control significantly higher. Buyers left ‘single prints’ in D period. These were left open and not contested, a sign of stronger buying.
/NQ TOP 9/27 and 9/28
It’s a great practice to start every planning session with the higher time frame, but milestone closes such as quarter end are a perfect opportunity to zoom way out.
I’m still watching the same areas as previously mentioned in SPX and AAPL for overall market sentiment and direction.
There’s been increased tax loss harvesting, particularly from mutual funds who report their year-end towards late October. So, there could be some booking of gains before that. These seem to be, however, temporary areas of support until they are lost.
This weekend is a fantastic time to evaluate your favorite products on much larger time frames to either validate or pivot your stance into year end.
As shown earlier, there is lots of news today, and combined with quarterly options expiry and close, it should be a volatile session. These are sessions normally poised for great scalping setups. I have not traded well for several Fridays in a row. Any position I take will be extremely tactical, with tight risk. Considering even invoking a 1-and-done arrangement for Fridays, so that any possibility for overtrading is smothered.
PCE / Core PCE / PMI numbers. The expectation is a 3-handle on Core PCE.
Government shutdown looms on October 1.
Yields have pulled back from but the curve remains steeper.
CCL reports before the bell. This is not a name I trade, but review of the chart revealed that it’s in an interesting spot. The discretionary space has been challenging to say the least. As stated Last earnings release experienced a slam into this $14 area. There is a large low volume node here. It also has just recently re-tested and closed that gap. If the breaks down, it could get ugly and slide all the way to $10. If this area holds, however, buyers could create some exit velocity out of this node.
Restating from the other day, a Fed study shows bottom 80% 5of earners have exhausted cash savings. So, spending in the area is expected to slow. Carnival cruises are however relatively cheap vacations - so may be a good alternative if this crowd is going to borrow for vacation spending.
UEC is reporting. Uranium has been on an absolute tear this quarter. No position.
Really would love to start scoping a long in GLD but need more studying to build a case on where to start this position.
Continuing to seek longs in /CL - again, this kind of has been a crowded long, but the narrative of tighter supply keeps the side of the trade advantageous.
VIX will gauge how I trade equities during the day. Vol crush would build the narrative of month-end, quarter-end mark up and continuation out of the SPX hammer formation. Any break of the value areas mention may bring a slide in equities and would probably put me on the sidelines.
Happy Quarter-End, and as always, Trade Well and Good Luck.
As always this is all for educational purposes only. You are solely responsible for your trades as I am for mine. Nothing contained here should be construed as financial advice, but only educational content about the markets and my particular trading style.