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Good Evening Horsemen Traders!
Hope everyone had a relaxing weekend. First lets start with a review of last week’s $SPY technical read. I stated, “I will be watching for some sideways action after the run up last week”. This statement rang true. Our Key Level last week was 408, which means we were watching this price area to be a potential source for bounces or shorts if the price broke below. Our resistance area was at 418, as you can see in the $SPY chart below we absolutely called these levels to a tee. 415-418 proved to be our resistance level while 408 bounced every day last week.
On the micro side there was a lot more successful follow throughs, usually when the broader market is trading in a consolidation range it makes it easier for traders to trust that the broader market will not dump on them out of nowhere. Thus allowing for stronger set ups and follow throughs. We had good success with some of our Watch-List ideas including $ASO $XERS $ENSV long while a few others $VIR and $RDBX were good short plays.
As for this week I think it will be a bit more tricky but also very profitable if you can catch the next direction. Since we have been in a consolidation range we should be watching for a breakout either to the up or downside. Monday will be an important day to see where traders put their money. We aren’t contending with to many economic catalyst early in the week but Friday we will see a update to the CPI Consumer Price Index tracking price gains in May. Traders and investors will watch to see if inflation may have peaked, or if price pressures are likely to accelerate further.
As usual lets start with a broader look at $SPY with some key levels and technical chart.
This Week’s SPY Key Levels:
- Key Level is still 408
- If key level can hold support then i'm looking for a continuation of consolidation with resistance areas at 415, 418 with a breakout entry potential at 420 for a run to 430 near the 200ema on the daily
- If key level cannot hold support then i'm looking for a flush out to 405-406 area for a first bounce area. If that breaks then we could be moving lower for a bigger move back to 400-395 areas.
- This market has been characterized by extreme moves. Just because we see our key levels break, a possible flush out does not mean we can't come right back up to test resistance areas. These fake outs are all too common
- I will be watching for entries on extended dips or pumps. It's likely we see a move this week that breaks consolidation (in either direction), at the same time the move might give a chance for traders on the sidelines to jump in and take advantage of any dip or breakout.
Enjoy the rest of our FHT Weekly Watch-List below…
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$TSLA
- Key Level is 700
- If key level can hold support then i'm looking for resistance areas at 730,750 then 785
- If key level cannot hold support i'm looking for bounce areas at 675 then 650 if 650 breaks 600 is next strong bounce area
Thesis
- Friday news brought a gap down on TSLA: "Report it will cut 10% staff and pause hiring; analyst expects EV maker to 'Ramp Back Up' in 2023"
- Possible opportunity on news. I like TSLA in the 600-700 for a long for a scalp or swing depending on broader market action
- There are also headwinds from China lockdowns this is affecting entire EV sector with exposure to China
- I will be watching for a possible "Traders Remorse" reversal (a bullish move) otherwise taking a short position with stop loss around 750 could be a nice trade back to low 600's
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$KSS
- Key Level is 41
- If key level can hold support then i'm looking for resistance areas at 42, 43, 44 with a gap fill at 46.6
- If key level cannot hold support then our first bounce area is 40-39.90 then 39.25 area.
Thesis:
- Thursday news; "NY Post reported Kohls auction was "delayed indefinitely" followed by more news from Wall Street Journal; "The company has mid-50's bid from Sycamore and a 60's bid from Franchise Group"
- Some really nice volatility on this mid-cap retail ticker
- We should see more news once Kohls board reviews the bids in the next few days.
- Technical’s are showing nice coiling meaning we should see a bigger move one way or the other soon.
- Before that move comes i'll be watching to see if 41-40 can hold as support, if so i'm leaning long. Under 40 i'm short biased.
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$LULU
- Key Level is 297.5
- If key level can hold support our next resistance areas are 300, 302.5, 308, 315 with 50ema at 318
- If key level cannot hold support our bounce area is 293.5, 290 with major support at 276 and a gap fill at 260 area
Thesis:
- Friday ER news; "North America Sales up 32%, bought back 232M at average price 328
- Solid results and held gains decently on Friday's weak action
- I'll be watching the key levels for entry with a long bias above 297.5
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$RPTX
- Key Level is 12.5
- If key level can hold support then i'm looking for a push to 13, 13.5 14 then 14.5-5 with 200ema at 17.80 area
- If key level cannot hold support then i'm looking for bounce levels at 12. If 12 breaks then we will probably head back to 11.15 (50ema on daily)
Thesis:
- News: "Announces a worldwide license and collaboration agreement with Roche for Camonsertib"
- Very nice movement on this low floater
- Holding gains with some more potential for upside, Shares Hard to Borrow.
- I think we can maybe see 15 if we continue to make higher lows and can hold that 12.5 key level.
- Watching close to see if volume holds, we may see some consolidation before a bigger move.
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$PSTG
- Key Level is 27.50
- If key level can hold support then i'm looking for next resistance areas at 28, 28.5 29 then 30
- If key level cannot hold support then i'm looking for next bounce area at 27 with a gap fill all the way back to 26 area
Thesis:
- News: "Q1 subscription services revenue was 219M =35% Y/Y"
- Stock is holding the 200ema as support. When price starts trading above the 200ema its a sign that bullish momentum has taken hold and we can see bounces from this level
- If we break under 200ema i'm looking for a quick reversal to confirm bull thesis.
- If we can't retake the 200ema than i'm looking for a possible "Island Reversal" pattern which is a bearish set up to fill the gap back down in the 26 area.
- I will be watching overall volume if we have higher volume then odds are we can still see more upside.
- Also watching for potential "ABCD Pattern" to give us a breakout of 29 area.
Economic Calendar
6/7 Balance of Trade (8:30 AM ET)
6/8 Wholesale Inventories (10:00 AM ET)
6/8 EIA Crude Oil & Gasoline Stocks (10:30 AM ET)
6/9 ECB Interest Rate Decision (7:45 AM ET)
6/9 Initial Jobless Claims (8:30 AM ET)
6/10 US Inflation Rate (8:30 AM ET)
6/10 Prelim Michigan Consumer Sentiment (10:00 AM ET)
6/10 US Monthly Budget Statement (2:00 PM ET)
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