Big Picture All Aboard The Run Away Market

by Bennett zamani April 18, 2021

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Broad Market Outlook

The run away market is in full effect as the S&P successfully broke $400 and has yet to look back. Putting in 4 new all time highs in the last 5 trading days the path of least resistance seems to be higher.

For the traders who are caught flat footed in cash, they are drooling, wishing for a pull back yet each pull back is quickly bought up. Leaving this crowd more impatient resulting in clouded judgement and wishful thinking.

The scary headlines are like tumbleweeds rolling through ghost towns in the mid west as the market continues to hitting new all time highs.

Yet are endless when the world is ending at 52 week lows.

Back in March finding a swing trading set up was like finding a needle in a hay stack.

Now with the market hitting new highs, finding a set up is like finding a piece of hay in the haystack.

It can be discouraging to want to put risk on when the market is hitting new highs, just like we claim we will put risk on during the crashes yet we rarely do.

This is why we need to keep it simple and focus on the set up in front of us.

WDAY up through $260 vs $250 is 4% risk, can you accept that? If so take the trade.

LULU is setting up through $320 vs $290 which is about 10% risk? Can you accept that? I personally can't so its a pass for me.

Right now the market seems expensive or extended yet our line in the sand is less then 3% lower. I can accept that risk.

For myself SPY above $400 its risk on, below $400 its risk off.

Its much easier to risk 3% at new all time highs then to risk 7-10% at all time lows (a lesson shoved down my own throat with DASH and SNOW recently) while the expensive blue sky breakouts (PHM, MDT, MMC) continue to get more expensive on less risk.

I am not telling you to blindly put on risk at new highs just focus on the spots where your risk is limited and defined and just when you start to say something is too expensive is often right before its about to become even more expensive.

From Ben G

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Macro Rotation Outlook

SPY

Dow Jones

Nasdaq

MDY Mid Caps

IWM Small Caps

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Do You Have The Patience to Make It On the Leader Board?

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Sector Rotation

Sensitive - sectors that have moderate correlations to overall market conditions.

VGT Tech

VDE Energy

VIS Industrial

VOX Telecom

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Cyclical - sectors that are more sensitive overall market conditions.

VAW Materials

VCR Consumer Discretionary

VFH Financials

VNQ REIT

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Monthly Goal Setting/Trade Review Call

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Defensive- sectors that tend to outperforming during sub par market conditions.

VDC Consumer Staples

VHT Healthcare

IBB Bio Tech

VPU Utilities

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Friends and Family Challenge

Have a friend that would like to give trading a shot?

Tell them to DM us on IG saying "friends and family"

They can start for the next 90 days at no cost.

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Big Picture Set Up

ABBV

ABBV has been a good test for most who got trapped learning the round trip lesson, with it putting in a new pivot low, we can now up that stop from 102 to 104 as it continues to try and break this green line.

AMD

AMD we took advantage of a great support buy as its drifted 6% higher, in time we could look to buy up through $84.

COO

Not as clean as a true blue sky breakout however tight risk at only 2.5% to be involved if it wants to clear $400 and head to new highs.

DHR

DHR has been slowing grinding 5% higher as we can now move our stop up to the recent pivot low, with the target to the upside being the prior highs. Really no reason to sell in between those two areas.

LULU

This LULU is setting up however still a bit too wide vs the proper pivot, one to keep on the radar if it tightens up.

MDT

MDT $122 was the prior all time high which is why we might meet some resistance here, stop break even in this one.

MMC

MMC continues to tick new highers as the buyers are pushing it 5% higher then our entry, for now still holding with a breakeven stop.

PHM

PHM we continue to sit with a break even stop as it continues to tick new highs up 9% from our entry, the path of least resistance looks to be higher for now.

SEE

SEE setting up for a blue sky breakout above $48 in time.

SNAP

SNAP did far better then we could imagine running 23% in less then 2 weeks, if you wanted to limit some risk as we approach this resistance area could make sense. As this fast 20-30% moves then to drop just as quickly as we have seen in the past ($52 to $72 back to $50).

TDG

TDG is setting up again for a potential breakout through $620 with risk in the trade hovering around 3%.

UPS

UPS marching nicely back to the retest of all time highs as we sit in an 8% winner so far, if you want to take the quick trade into the retest or limit your downside could make sense. If you want to hold for the potential break out down the road more then likely will need to open minded to give this back to your price.

WDAY

Tight flag forming in this WDAY up through $260 risking just under 4% vs the low of the flag.

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Traveling Experts

We have a few exciting experiences planned for the year ahead. We hope you find a trip that sparks your interest to come enjoy and network with other like minded members!

Big Picture All Aboard The Run Away Market

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