Here’s The Bounce
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I wouldn’t call today’s rebound attempt one to write home about, but nonetheless, we got what we were looking for: Early weakness that materialized into a bounce, with the VIX dropping further and indices bouncing. Smells a little bit like victory.
We can really see the market go either way here, though with Friday approaching, my contrarian tendencies would prefer a bigger bounce tomorrow, then perhaps weakness next week. No need to take a trade based on guessing, we’ve had ample opportunities to line up our horses in the morning after seeing what GEX indicates as the highest probability pathway, one day at a time.
SPX can rise as high as the Hull Moving Average and I will still be looking on the short side, though we have to acknowledge the Keltners remain in a bullish channel, creating higher lows and higher highs as far as the Keltner boundaries are concerned.
SPX GEX is still positive, though technically within the neutral range, despite SPY being firmly negative at -1.1B. I tend to give SPX more credit, until proven wrong with the way such a difference unfolds going forward.
SPX Historical GEX: www.geeksoffinance.com
Our SPX GEX Levels chart shows that SPX is in a Dealer Cluster Zone, though we can stretch all the way up to 5800 and still be within the expected boundaries. 5400 sits on the downside and we saw unusual volume at 5000, though I wouldn’t personally draw any actionable conclusions from that.
SPX GEX Levels: www.geeksoffinance.com
We’re going to end tonight’s newsletter with a sort of “lightning round” look at two tickers: TSLA and SMH. Let’s start with TSLA:
Sizable gap down on delivery news this morning
Keltners look bullish, though we didn’t quite reach the middle channel, so we’re sort of in “no man’s land” as far as the Keltners go
Below the Hull, so we are biased short, though cross-currents exist due to positive GEX and big GEX at 260 and even 300.
We see a big GEX cluster at 260 for Oct. 11, which would be my target for a long trade. This would mean I’m not counting on breaking above the Hull, I am simply looking for a move back up to retest that area, whether we see it reject or not after that attempt.
TSLA 3D GEX Graph: www.geeksoffinance.com
SMH: The chart looks neutral overall, we are consolidating in a wide range since August. We currently sit below the Hull but above the middle Keltner, though my speculative interpretation is that odds are good for a push higher.
Our 3D GEX graph shows 255 as a fairly significant GEX cluster for Oct. 18 (the largest one for this Friday is at 243). 255 also coincides with the upper Keltner channel, a logical target if we start moving higher.
We’re watching several other tickers, so check in with us in Discord to see how we decide to play certain trade ideas for our Educational Portfolio. Thanks for reading!
SMH 3D GEX graph: www.geeksoffinance.com
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