The Shakedown 2/4/18


FEB 4, 2018


I've been getting a ton of messages from newer member's asking whether I think the bull market is done for because of Friday which is straight up laughable when zooming out and looking at the macro picture.

The trend is your friend. This is the first pull back in forever and is healthy as well as much needed for the overall market. Things can't go straight up forever, so much like a stock that's been on a huge run, we want to see the market digest, find support and give us sideways action. I will be much less active in the beginning of the week after Friday's action but will be watching to see how the market responds throughout the week.

From a technical standpoint, the SPY has light support pretty much every figure down $275, $274, etc with a bigger support level at $270.

When you see puke selling, the first on the chopping blocks are the "risk-on" names, the high-beta's. 

A quick look at the heat map reveals  tech & services stocks (top left/middle) took the brunt of the beating being the most red sectors -- except Amazon & Netflix of course. Take a look to the bottom right at the Utilities where you see many "risk-off" stocks were unchanged. These stocks are considered "flights to safety" and now we're seeing that in real time. 


Updated earnings watchlist 2/4/18

Click this shit
Earnings Calendar

After the market is stretched like it was Friday, a majority of stocks will get stretched with it. Since we primarily buy stocks coming out of consolidation, I wouldn't expect too many things to trigger Monday. We have to be on the hunt for setups to develop throughout the week.


Sporting a beautiful macro bull flag, on the back of a solid earnings beat, EXPO looks primed for higher prices. They even gave us a strong inside day Friday just underneath $77 resistance. The only problem with the setup from an execution standpoint is that it will likely trigger early off the open Monday morning, whether that be on real volume or not. If it triggers off the open I will be using a stop at the morning low. I don't want to give this $6 risk down to $71 without it really triggering on heavy volume. You can use an Opening Range Breakout to enter or even wait to buy $78 as confirmation. 

Trigger: $77

Stop: LOD/$71 support

Target: 88-90+

Hope to see you in the chat Monday!

Fuck Tom Brady [Who kisses their kid like that?] Go Birds! (-sad Jets fan)

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