Welcome back, everyone.
Jumping right into the recap, we saw strong upside above one of the key levels sent yesterday. The 7182 VAL set the S&P up for a strong rally once above. Overnight we rallied above this level and hit the intraday target at 7209. After the open there was a quick fakeout of downside before breaking back above the long level and hitting our target for the end of the week (7250).
Near the end of the session we also called on a long setup that was sent out in chat. We had our eye on this at the beginning of the week which now makes four long setups posted this week alone. Three separate sectors to capture upside momentum.
On top of this, we posted that all indices are currently bullish with SPY, QQQ, and DIA, all in a powertrend. Although IWM continues to be bullish and is on track to post the 44th week in a row of the 10-week EMA being above the 21-week EMA. Ever since posting on X that there’s a clear bullish recovery in play, we have rallied nearly 300 handles to the upside on the S&P. On the Nasdaq were up over 2,100 handles for +8%. Just to put that in perspective, this is already up half of the annual average in half a month.
Many times I said the tide will eventually shift and the EMA’s will guide us to the right direction. If you caught the bottom then congratulations but you will never do so when trend following. Our main focus relies on capturing the majority of major trends.
All of this seems jolly right now but not everything is currently bullish. Internals are currently slightly mixed but showing signs of overheating. The ADD is showing positive signs as the majority of stocks are currently also rallying with the S&P. Inflation is starting to be impacted from not only the lagging tariffs but also the higher prices of gas. Overall demand will ultimately slowdown but there isn’t a telling on the timing of this. Signals from the Fed are beginning to be mixed as anticipation of inflation going up is increased. Cuts are far out the window as of right now and some members are leaning towards hiking. The Fed balance sheet is on the decline while funds parked in RRP are on the rise. Money is also being drained from the Treasury which tends to come once tax season wraps up, like clockwork. Overall this is not a good sign in terms of liquidity for the market. All of this put together poses a clear tailwind that’s building up.
Look, the EMA’s on the indices and even plenty of stocks are looking phenomenal. When we have these warnings we need to simply look for potential areas of support where you know you want to be a buyer. I expect this uptrend to remain valid into 2027 but that’s not to say we will not see any selling at all. Any sells into the 10-week and 21-week EMA are gifts in uptrends. The market is giving you an opportunity to get long or just build into a larger position.
If your currently long on a swing timeframe then you will more than likely be fine. Caution needs to be sent to the ones who are buying short term contracts or looking for quick moves. In terms of sectors that typically outperform in this environment, you want to be focused on Energy, Materials, and Industrials. Real Estate, Utilities, and high multiple tech tend to be hit much harder.
Outside of all this, whether the sell comes or not, guidance will be posted right here in the substack.
Now let’s cover the stock that was sent out in chat today.
JPM - JP Morgan Chase
Here’s what we sent out in yesterdays post:
This should be an overall strong stock leading into the rest of the year. Bank of America is also on the radar but this is the clear leader in terms of strength so we will stick with JPM. As long as the stock holds within the current range for the week, a Positive EMA Stack will occur. Within the next couple months this will open the doors to a rally to new highs. LEAPS will do great with this stock especially if the momentum on this begins to increase. Contracts for this will be sent on Friday as long as this holds.
Just as we called on, JPM saw a strong rally and will very likely close the week green. This will fire off a valid uptrend on the stock and now paves the way for new highs.
We posted contracts for this inside chat:
Now let’s move on to the levels for today’s session.
S&P Levels
Crystal clear trend type move today with the S&P closing at session highs. Price soared the moment we crossed above the 7209 VAH. Since the market is at a current ATH we will pay close attention to the volume above that VAH. As you can see, we really never saw strong volume come in until we traded around 7230s. Above this we began to build up a high volume node (HVN) which is a sign of acceptance. You want price to remain inside this node and then continue higher to keep this strong buying intact.
At the time of writing this post, we are currently trading at 7250 which is in the upper end of this HVN. For a key support level we will use 7238 which is the bottom end of this node. Buyers previously held the market up into the close and I expect they will continue to do so into today. As long as we remain above this level, price can continue to rally up to 7300.
On the contrary, breaks below 7230 give signs of this rally being a trap. This will likely lead to a sell right back down to the value area just below. The main target for downside will be the POC at 7193.
That’s all from me, if you found value in this post then feel free to drop a like and share!
-Flint
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