The Shakedown 7-5-21

LAST WEEK, S&P 500 (+1.67%)

Monday: +0.20%

Tuesday: +0.05%

Wednesday: +0.08%

Thursday: +0.55%

Friday: +0.76%

We got another strong week out of the market as both the S&P and Nasdaq closed at new all time highs. The market continues to shrug off any economic data that could be conceived as bad news as we continue to march higher. We have experienced a great swing trading environment over the past month and change, and look for that action to continue.

 

That being said, I am not salivating to put on new risk with the market at these elevated levels. I will continue to take trades as I see fit but I certainly don't want to have a shotgun approach where I take every single setup because the markets at highs. It still pays to be ultra selective with your risk into the best looking setups.  The S&P gained 4.5% over the past two weeks as we've seemingly gone straight up since we pivoted off support on June 21st. We have to be realistic with our expectations of the market, and can't expect this 'straight up' action to continue without seeing some healthy digestion to eventually move us higher.

 

So I will be watching the market closely this week and picking my spots when putting new risk on. 

Earnings This Week

Click the above picture for a full list of the companies reporting this week

*MAKE SURE YOU KNOW WHEN STOCKS

YOU'RE TRADING HAVE EARNINGS*

BMY Long

This BMY is shaping up very well for a macro swing setup. We always love it when a trade looks good on multiple time frames. This one is setting up not only on the daily chart, but also on the weekly and monthly charts as it's looking to take on a resistance level it hasn't been able to overcome the past 3 years. The difference this time is that the daily chart is showing us ample consolidation at the upper end of the range, making an entry this week look quite appetizing.

This is not at all a short-term trade, but will look to have this one gain over the next few weeks even months. In a perfect world they'll allow us to enter through 67.25 with a tight stop below 66 judging off the consolidation the past week. But, understand the proper stop is below the 65 support area. So I'll use two stops and have different targets (based on risk/reward) utilizing the two stops, treating them as separate trades. 

Trigger: $67.25

Stop: $65.89/64.89

Target: $74-78+


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