This is a chart of NYSE NEW 52-WK HI LOW DIFFERENCE that I'm posting to show the massive positive divergence at Friday's new lows, which was an additional buy signal. Thursday's new lows expanded to 245. Friday, at a new price low on S&P 500, there were only 133 stocks hitting new lows.
What other clues were there? Thursday also retested the 7/26 up day again, but came into it with 15% lighter volume. Friday morning, futures engulfed the low and the afternoon high from Thursday. A declining wedge was noted that targeted +/- 1342-1340. Price then rolled over and fresh lows were printed (1343.35) into a crowded Fibonacci zone. A/Ds were muted.
Each of these clues were noted in real-time on Twitter (that's why I use it -- so I can examine my thinking afterwards). I got long SPY 135 calls across all three of my accounts.
At the open I will take a lot off the table. The rest I will leave to hedge against with either short e-minis or SH or SDS. But I'm looking for a pretty heavy bounce. 1400 is not out of the question.
Even so, it looks like the market will open at a 61.8% retracement level, so I would expect some reaction. If not, 1388.61 should be the first target.
If the market wants to roll over and play dead, 1315.77-1319 would make a good target zone.
Had a great day Friday with AAPL calls, too. Had two 2X and two 3X trades. But I left a ton on the table with my first trade. If I had just left it alone it would've been 10X. However, hindsight is always 20/20. Weekly options expiring end-of-day need to be managed with discipline or they can return ZERO just as easily. I'll book 3X twice any day.
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