🟢 Weekend Market Prep 🟢

$SPY is down three weeks in a row and below the June lows. You need to have a plan.

Look here for some ideas. 👇

Hurricane Week!

Fiona hit Puerto Rico and Ian hit Florida. I hope all of you and your families are safe and relatively undamaged. Sadly, I know many are not.

Ian and Fiona weren’t the only storms brewing as the market felt a bit precarious coming into the week.

The indexes tried to hold up but weakened into the close Friday. Not a great end to the week/month/quarter.

Each day that we don’t make upward progress is a day that adds fuel to the bearish fire.

So far the "bounce" story leaves much to be desired. Price action just isn’t supporting it. In fact, the indexes have been in a bearish consolidation pattern, working off the downside extension and allowing the short-term moving averages to catch up (down?) to price.

That looks more like continuation than reversal.

The overall trend is still down. While a bounce would be very welcomed by the bulls, it would still be a counter-trend move and would need to be treated as such.

Here are the charts-

$SPY - not a bullish finish to the week

$QQQ - looking vulnerable

$IWM - A possible bear flag pattern here gives a measured move target of around the $144 price area.

$DXY - The Dollar did come down this week which gave the bulls some hope. So far it hasn’t been enough.

$VIX - Implied volatility is still elevated and may want to go higher still.

The bull and bear case here is very simple.

• Do we break above this potential island bottom, stay above, and move higher?

• Or do we break down from the bearish consolidation and keep going lower?

Flushing into the close on Friday isn’t bullish.

This week watch $SPY 372.30 on the upside. Seems like a tall order.

On the downside, with prices below the June lows, we have to look further for potential support. The pre-covid high in the area of 340 could be a spot.

See this thread for monthly charts and a bigger-picture view.

https://twitter.com/Andy__Moss/status/1576180458877964290

As bad as the charts look, a bounce of some sort isn't out of the question.

To know what to look for read

this - Could We See a bounce?

and this - A Look at Mid-Term Election Years