Neutral SPY Technical Levels and Catalysts
"All right, let's kick things off by first going into the SPY. I want to make a few points there about what I'm watching. This was the last stress test the market went through on the SPY back in July. We had this red bearish week and then a recovery that pushed price back to the top of the range. Now, we're in the beginning of our second week and we're still struggling with the top of this range, which means the market largely is neutral. However, if positive catalysts emerge and the market pushes above 675, we could rip straight away to 680, making brand new all-time highs."
The analyst reviews SPY's technical levels, noting that the market is currently neutral as it consolidates near the top of a key bearish candle from July. He highlights important trigger levels around 671 and 675, suggesting that a breakout above 675 could lead to a bullish move to 680. The commentary emphasizes the need for a catalyst to shift the market's neutral stance.
SPY Volume Analysis Suggests Upside with Risk of Rejection
"Alright, lets quickly go over to the Spy. Im going to break down what it is I like in that chart and why I think next week the markets will be higher even though we didnt break above that 666 number or that bearish engulfing candle. The story is all about volume this week. I think they can go up to 680, but if a potential MACD cross down occurs, we could see rejection down to around 640."
The speaker analyzes SPY using weekly volume and technical indicators, predicting a potential rise toward 680 based on smart money buying, but cautions that a MACD cross down could result in a decline to 640, reflecting a mixed but ultimately cautiously bullish view.
Increase Cash Position for SPY Pullback Opportunity
"Finally, and perhaps most importantly, increase your cash position using short-term instruments like Mint. With the market near all-time highs and a seasonally volatile October ahead, holding cash to capitalize on a potential 5% or 10% pullback in SPY is a sound risk management move."
The host recommends boosting cash reserves to exploit a possible 5%-10% pullback in SPY, suggesting a tactical move to secure liquidity amid near all-time high market valuations, reflecting a risk management stance in a volatile environment.
Potential SPY Entry at 638.45
"If SPY gets back to 638.45, that's the area I would like to potentially enter. And then also with Quad Witch and coming up, you want to be out three or four days before the expiration."
The speaker advises a trade on SPY, indicating an entry point at 638.45 with an actionable timeline to exit options positions three to four days prior to the September 19th expiration as a hedge against volatility.