Interesting theory on SPY: possible ST short?
Bear case (just a theory): If we take a look at time and space on this daily chart, 25 bars (35 days) for the trough-peak-trough before the election. If we take the FDA talk on the vaccine for the same whatever reason, I believe there is a possible downside of ~9% until Dec 9th, a trough-peak-trough total of 29 bars (36 days).
- Yellow trend line act as support.
- Volume has been a downtrend.
- The two overheard white trendlines represent a strong resistance on the daily and weekly charts. (candles move easier towards less resistance direction)
- Technically only tested bottom support twice (red shadow or yellow trendline), possibly the third time?
- Small rsi divergence on weekly.
Bull case: Priced in. Spy looking to break overheard trendlines or move closely with it.
- Tested the overhead trendlines three times with the last retest completed, possibly going higher. (green arrow)
- Options pricing in more downward risks but not so much upside risk. (this is normal due to the nature of hedging) pasteboard.co/JC5xURm.jpg
- For educational purpose: tastytrade.com/tt/learn/volatility-skew
- Some of the macros: 10yr yield steady uptrend, low vix, gold downtrend, dollar going for new low since march.
Just a theory, will keep my longs on, may just short with an option contract or two to defend downside risk.
- Yellow trend line act as support.
- Volume has been a downtrend.
- The two overheard white trendlines represent a strong resistance on the daily and weekly charts. (candles move easier towards less resistance direction)
- Technically only tested bottom support twice (red shadow or yellow trendline), possibly the third time?
- Small rsi divergence on weekly.
Bull case: Priced in. Spy looking to break overheard trendlines or move closely with it.
- Tested the overhead trendlines three times with the last retest completed, possibly going higher. (green arrow)
- Options pricing in more downward risks but not so much upside risk. (this is normal due to the nature of hedging) pasteboard.co/JC5xURm.jpg
- For educational purpose: tastytrade.com/tt/learn/volatility-skew
- Some of the macros: 10yr yield steady uptrend, low vix, gold downtrend, dollar going for new low since march.
Just a theory, will keep my longs on, may just short with an option contract or two to defend downside risk.
כתב ויתור
המידע והפרסומים אינם אמורים להיות, ואינם מהווים, עצות פיננסיות, השקעות, מסחר או סוגים אחרים של עצות או המלצות שסופקו או מאושרים על ידי TradingView. קרא עוד בתנאים וההגבלות.