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Good Friday morning!
It's Triple Witching today and before you get too frightened, all it means is the simultaneous expiration of stock options, stock index futures, and stock index options contracts, all on the same trading day, and this happens four times a year, on the third Friday of March, June, September, and December.
As I mentioned the other day, during "Rollover" the expiring contract gets replaced with the new contract...in this case from M to U....June to September. Now those that don't trade futures don't need to worry about that specifically, but what ALL OF US need to worry about is the increased and heightened volatility which occurs on these days. The reason is because traders and investors around the world have to either close, exercise or roll these instruments and that causes more trading volume and intraday price movement and volatility. So just a heads up!
Futures are lower this morning and overnight inventory is mixed. While the bulls are still in control, there was some liquidation yesterday and it seems some froth is being taken off the top. As you can see in the key levels and profile pic below, we are below the key 1/2 back level from yesterday @ 5550 and there is a target below which is highlighted in the profile pic so please take note. 5525 will be the next key line in the sand and then 5510 and then 5490 if we do get heavier selling. I am not saying this is guaranteed to happen but lets keep a close eye on 5525. If the buyers stand their ground and there is a move back over 5550, then shoot for upper the target.
SBUX: Holding and profitable but we are ready to punt it away if it breaks our stop of $79.50.
TSLA: Holding and the calls we sold calls on Tuesday at the $192.50 strike for .71 cents have a 97% chance of expiring worthless today by expiration so this will lower our cost basis in the stock. I am now looking to sell calls for next Friday however, if the market, and large cap tech in particular starts to tank, then I will just take profits and sell the stock and revisit it later.
VPOC Update: No new VPOC's on Tuesday so we still have 24 VPOC's below current price levels.
TARGETS AND KEY LEVELS TO WATCH:
/ES upside target is: 5575
Key Level: 5550 1/2 Back
downside target is: 5525 then 5510 if broken
/NQ upside target is: 20,145 - 20,165
Key Level: 20,110 Single Prints and 1/2 Back
downside target is : 19,920 - 19,900
RTY upside target is: 2055 - 2058
downside target is: 2024 - 2020
Economic Data:
PMI Composite Flash @ 9:45 AM EST
Existing Home Sales @ 10:00 AM EST
Leading Indicators @ 10:00 AM EST
Natural Gas Inventories @ 10:30 AM EST
More Color.......
/ES - Key Demand at $5525 LOD- 5530-5580 with Supply above at $5580
1. Sellers trapped above $5575 looking to play long targeting $5588
2. Buyers trapped below $5530 looking to play short targeting new LOD
SPY - Demand $543-545 with Demand flipped to Supply at $548-547
1. A breakdown below $547 and holding after a pullback I will look to play
short targeting $546 then$ 545
2. Sellers trapped above $544 I will look to play long off a break and retest
from $547 then targeting $550
SPX Key Demand at $5445 LOD with Supply above at $5490
1. A breakdown below $5490 and holding below after retest I will look to play short targeting $5450
2. A bounce above $5450 I will look to play long targeting $5485 then new
HOD
/NQ Supply at $20100-20075 with Demand at $19900 previous GAP Up
1. Sellers trapped above $20100 looking to play long targeting $20150
2. A breakdown below $19900 I will look to play short targeting $19855
QQQ Key Demand at $478-480 with Supply above $489 HOD
1. Sellers trapped above $478 looking to play long off a break and retest
targeting $480 then new HOD
2. Buyers trapped below $478 playing short after a break and retest
targeting $476
As ALWAYS, have your stops & targets in place and have a great weekend!!!
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