Market Analysis and Trades for 5/16
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The weekly post and video for SPY 0.00%↑ and QQQ 0.00%↑ should be reviewed prior to this. Link to Market Analysis for The Week Ahead
Trading lower first (especially overnight) while in a bullish trend is almost always a dip buy opportunity. We saw that again today. The overnight session essentially went on a “structure repair mission” completing yesterday’s work. Yesterday’s low of day 5890 represented filling of the Tuesday B-period single prints, and the overnight session completed the back fill to Tuesday’s open. This was an available trade but I’m not a huge fan of breakdown shorts in a bullish trend. I prefer to look for longs as a look below and fail once the “structure repair” short trade has played out:
The cash session then opened right at yesterday’s low and the LBAF triggered from the 5884.75-5887.75 spot (5884.5 low of day). There was quite a battle for ultimate control of the key 5896.75 spot). Once bulls won the battle, all upside targets including new highs were hit. From last night’s plan and the morning update in Discord:
Tomorrow is monthly options expiration which can sometimes trigger a change in character, so we’ll have an open mind about that but as of now bulls remain in full control.
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