Today's Intraday SPX View

Just when I thought we might have a nice rally headed into the holiday weekend, kablami! We got hit with another down day… and a pretty big one, at that. Volume was crap (expected), but the move caught me a little off guard. 


Check out the chart below (sorry for all of the lines). Notice that we’re currently in a falling channel and a falling wedge. Until we get out of the channel, we’re still, by definition, in a bearish pattern and must treat it as such.


Tomorrow, I’ll stick to my intraday trades and watch the SPX for times to load up or tread lightly. 1040 is still the level of concern. Below that and we could see a panic sell-off. Stay on your toes.





In addition to watching the daily SPX for general market direction, I also spend market hours watching the SPX intraday (3 minute chart). A few traders today asked me what I’m looking for intraday from a macro standpoint…. With market direction and individual stocks hard to swing, I’ve been spending a lot of time in TZA and TNA based off of SPX moves. Check out the chart below (today’s 3 minute) for a few clues of when I’m jumping in TZA / TNA and why. There are other indicators I’m looking at, but this should give you something to start from and consider if you’re playing market macro ETFs, etc.


A simple, first approach is to watch the bollinger bands and trendlines/support on the SPX and play TZA / TNA around it.


In this chart, the bollinger bands are set to (10,2). When bollinger bands narrow (coiling), then it means a move is likely about to occur. This is when I get ready to go long TNA or short TZA. 


Orange arrows show moves after tight bollinger bands open up. Notice how the SPX moved well after every narrow bollinger band range. The most obvious (very tight bollinger bands) at the green arrow.   Finding which way the breakout is going helps determine the TZA or TNA trade and risk/reward. 


Secondly, notice the channels (white lines). These points often represent resistance and a turn in the market direction. There are often good entries at these points when the SPX reverses or breaks out through the channel. Notice the breakouts through channel (white arrows).


I hope this quick look at the SPX intraday helps. Let me know if you have any questions or thoughts. This isn’t the magic answer to trading, but with practice, and adding your own timing and chart indicators, can help you manage your risk thus maximizing profits.
See you tomorrow!





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