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Good morning!
We hope everyone had a great weekend and enjoyed watching the Super Bowl! What a game!
Markets hit new record highs...again....and there still isn't a single seller to be found anywhere on planet earth! Believe me I've looked! Bulls still have firm control of this market and there is absolutely zero fear in this market.....if you are long then stay long!
What we are witnessing by the way is almost unprecedented. I mean we have had market rallies before but the trajectory and speed of this market going in only one direction, straight up, is extremely rare and very far from normal price action. As I have said recently, the amount of fiscal and monetary stimulus has been record breaking and all that money is chasing the same thing right now.....AI stocks and companies that are performing well. That's it! By the way, it is also very unsettling when you think about the amount of debt our government has put us in but no one seems to care!!
So for now, the "game" continues up and that's it! Do not fight it but also be ready for when the day of reckoning comes. Please remember when everything is this bullish and everyone is drinking the same kool aid, there is mass hysteria and euphoria and everyone is chasing stocks higher, that is exactly what can keep this market going for the foreseeable future!
However, it is also the time when people think there can never be a correction and that is usually when they get hurt. Bulls are still on offense but be ready to get defensive. Again not an easy task to predict exactly when this will happen but it will at some point!! And trust me I am a bull at heart but I also know when things are a bit "off" and stretched way off center.
The profile below tells us exactly where the lines in the sand are as of this writing. The breakout Friday had shorts scrambling to cover once again and 99% of the time and volume is above the Wednesday/Thursday highs so there you will now see our new levels of importance.
We also had a double distribution Friday so the first key line in the sand will be above 5034-5032. As long as we remain above those levels, the bulls are still in control. IF, and this is a big IF, we break below 5034-5032, then the prior two day highs of 5020 will be the next downside target. 5055-5060 is the upside target.
Futures are slightly lower this morning and inventory is mixed. We are also opening inside of Friday's range so there is no true edge at this time to signal to us whether to look for longs or shorts. Stay alert!
And YES you guessed it....another new VPOC on Friday as we now sit with 18 untested points of control still below. And just a heads up folks.......this is VERY RARE and I have never seen this happen before. This has a very, very low probability of happening, however, this is the game that is being played right now and we must respect the big money players as they only have the buy button turned on!
TARGETS AND KEY LEVELS TO WATCH:
/ES upside target is: 5050 - 5060
downside target is: 5040 - 5030 (key levels mentioned above)
/NQ upside target is: 18,100 - 18,125
downside target is: 18,040 - 18,010 (then 17,995 pivot)
/RTY upside target is: 2020 - 2025
downside target is: 2005 - 2000
Economic Data Today: Very Light Today
**FED member Kashkari speaks today @ 1:00 PM EST.
Treasury Statement @ 2:00 PM EST
More Color.......
/ES - Consolidating inside Supply at $5050-5040 with Demand below at $5010-5000
- Ideally I want to see sellers trapped at the open with price holding above $5010
to play long targeting $5025 first then $5035.
- Below $5000 I would like to see price hold to play a break and retest short
SPY - Consolidating inside Supply at $502-500 w/ demand at $497-498 then $489-91
- I would like to see selling at the open playing long off a break / retest from $498
- I would only look to scalp short if price breaks below $497 or retest below $500
with with failing to make a new HOD targeting $498.80
SPX - Consolidating inside Supply at $5030 HOD - 5020 w/ demand at $5000-10
- I can only look to play to short if price breaks below $4985
- I would like to be playing long after some selling finds support off a break & retest
/NQ - Consolidating inside Supply at $18071 HOD - 18015 w/ demand at $17900
- I would only look to play shot if price can hold below $17870
QQQ - Consolidation inside supply at $438-436 w/ demand at $432-434
- Key Demand zone below that $430-432 that was previously supply.
Also Watching …
AMD - Consolidating inside $175-173 after overnight Gap up
- I would like to play long off a break and retest from $172 targeting $174
TSLA - Consolidating inside Supply at $196-194 w/ with Supply flipped to Demand at
$190-192. I would like to play long above $190 after sellers become trapped at the open
- Below $189 leaves room to the downside where demand isn't until $185
Have a great day!
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