Samantha's RECORDED Live Trading Room - 12/20/24
With #LTR Notes - by Samantha, Rithika and Mikey
Samantha’s Live Trading Room Summary - 12/20/2024
Warned Mon/Tues the air pocket of risk in selling under the surface was about to pull down SPX, QQQ after giving IWM + DIA short price targets:
“DIA en route short to 433.20 ~100D with 422.62 overshoot if we see that 55D break, and IWM at my 230 PT with 55D just below at 230.30 looking unlikely to hold so 224.23.”
As you know, IWM $230P went from $1 to $10 ;-)
TODAY, we gapped down and DIA tagged 422.62 perfectly and bounced, along with IWM off 30W support back into 100D resistance of 224.23. Irony?
No, it’s a reflexive bounce from very oversold levels, plus, what I showed yday was needing to be defended: SPX $5850 critical gamma support. Add on top quad witching (Dec 20th OpEx) forcing dealers to cover. Add on top tons of key technical support levels for indices, stocks, and indicators... many I showed near open this morning, again in my very raspy voice (apologies), and before Goolsbee (Fed head) came out and intonate more cuts then dot plot suggested!
Market rallied - Lotto Friday Chasers Rejoiced!
But in the same way I said M/T “crashes happen from oversold”, we can see that bounces happen from here as well. Zooming out beyond intraday, best I could offer up this morning was GREEN SHOOTS on swing basis - after reiterating yesterday that I did not trust the intraday rally. This proved very correct given markets gapped down in futures so congrats for staying chase short!
Well, today SPX held 5850 and that’s great, BUT, I showed how many of my indicators need time to repair - think CHOP into year-end. We also have to deal with government shutdown, Avian Flu trending and always war vibes. For now, we are having a needed bounce after water-fall cascading lower in NYSE breadth and selling. But this is not August 5th convexity short-covering bounce - as I detailed in market thoughts yday.
PCE came in lighter than expected helping bonds to bounce and dollar to soften - AS EXPECTED. Now that TLT and 10Y T-note futures have reached PTs, I expect USD + UST to digest sideways into year-end.
NVO was a big winner for those who stayed short. I updated SWING channel, but this rec’d short from $138 was ripe to fall into $86 target. Well, today, it sliced through to $74 before bouncing back up to $86. LLY I do not trust for higher as expressed and fully expect this to fall next year.
FDX another SWING short, but with earning no edge, did in fact delight pre-market on news they would spin off a company, but that smells more of desperation and market reaction sold that high with stock going green-to-red. I like these odds of it breaking 275 on way to 259, still.
BB was a spec play I rec’d few wks back once above 200D on nothing more than a Hedge Fund factor-rotation short-covering play into YE. It triggered last week above $2.70 and is pushing $3.70 this morning.
SVXY fell into PT and today bounced exactly where it needed - as shown live.
VIX <> 19.29 is still your lever long/short this market. It’ll help keep you sane while market digests into year-end. But I would still keep your hedges. Market is still fragile - especially judging from the WATERFALL cascade in my key breadth tell which erased all gains back to SEPTEMBER and showed no bounce today...
I will wish all a great weekend. Trading room is open next MON/THURS/FRI - closed of course on Xmas Wed but I’m also giving the team Xmas Eve day off. Thanks again for covering for me, team!! I appreciate you, very very much.