SPY / 2D / Short Of The Year?
Diupdate
For those that dare to take on the AI bulls, we have a very interesting and very high R:R trade here on SPY/SPX. Keep in mind you are of course trying to catch a top, so the probability of success may not be very high.
Rationale:
Technicals point to our last line of defense. 4300 / 430 is the last major resistance before our all time high on the index. If there is any chance of this recession continuing further, it is reasonable that we reject from this level and move lower. The 2 day chart does not show it too well, but the daily chart shows a rejection yesterday from this upper resistance trend line, which odviously resides on our major resistance level. This level also coincides with the 1.272 fibonacci extension from our Wave A as shown on the chart. The risky entry is right now, on open 6/6/23, or a more conservative entry would be to wait for a more clear rejection like an engulfing candle off of this level.
Fundamentals point to a slowdown. There is no rationale for our upside move besides overhyped news. Inflation is still rampant, the war in Ukraine rages on, Joe Biden cant find stable footing, and our tech rally cannot continue forever. Of course, there is a counter-argument to the fundamentals here as the market has not been behaving rationally, why would it start to do so now. This trade is primarily technically based, and should we break and close above $430, this trade idea is invalidated.
Rationale:
Technicals point to our last line of defense. 4300 / 430 is the last major resistance before our all time high on the index. If there is any chance of this recession continuing further, it is reasonable that we reject from this level and move lower. The 2 day chart does not show it too well, but the daily chart shows a rejection yesterday from this upper resistance trend line, which odviously resides on our major resistance level. This level also coincides with the 1.272 fibonacci extension from our Wave A as shown on the chart. The risky entry is right now, on open 6/6/23, or a more conservative entry would be to wait for a more clear rejection like an engulfing candle off of this level.
Fundamentals point to a slowdown. There is no rationale for our upside move besides overhyped news. Inflation is still rampant, the war in Ukraine rages on, Joe Biden cant find stable footing, and our tech rally cannot continue forever. Of course, there is a counter-argument to the fundamentals here as the market has not been behaving rationally, why would it start to do so now. This trade is primarily technically based, and should we break and close above $430, this trade idea is invalidated.
Trade aktif
rejection on daily and 2D charts for a more conservative entry than prior
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