FRIDAY’S KEY TAKEAWAYS

Overall activity goes out the same way it came into the week, a sloppy mess.. on top of all the earnings positioning & hedging we’ve already been dealing with, we had the added wrinkle of July position replacement being a quad-witch Friday expiration .. That aside, we started to at least see some post-earnings buying off some weakness & should see more of it as the earnings season progresses.. Most of the buying has come with some time behind it but that’s what we want while we get sentiment to cool down .. it allows us to take our time, piece into a position or wait & watch for additional buying to come in.. we should also start to see the more aggressive buying in shorter-term strikes pick up a bit in a week or so, as we get thru the heart of earnings & a huge July FOMC decision.. We’ll obviously go over some of these names & strategy on the Sunday evening webinar.

Sentiment which started out Friday a bit on the hot side off a morning gap up, ended the session in a lot better shape thanks to a green to red fade.. Nothing better than punching chasing bulls immediately off a fade to cool off their bullish emotions .. short term indicators are in striking distance & could set up a squeeze signal off some additional weakness next week .. intermediate-term Sentiment, which was our larger concern still has a little work left to do but markets are doing what they need to do for now & things can happen fast these days.. let’s save it for an in depth discussion Sunday nite as well as any new signals from our sharp commercial hedgers .. Webinar starts at 6pm when futures open & as always, will be recorded .. see you folks there, HAGW!

💡 WEDNESDAY’S KEY TAKEAWAYS

Today’s action was one big hot mess dominated by earnings positioning & a bit more protection than we have seen of late ..Today’s weakness did make a little dent in sentiment but mostly in our short-term indicators & p/c ratios .. As far as our intermediate term stuff, it’s more about time than anything else .. in other words, unless markets really unravel this week, we’re likely gonna need to see a bit of length in time for this breather to wash out some bullish heat .. but that’s ok, don’t fret .. because even if we do go into some lengthy consolidation or drawdown, there will be several squeeze opps off weakness .. and as we’ve discussed at length, the possibility of rotation that will allow us to do some stockpicking for outperformance .. in the meantime, we’re still in the hands of the almighty “earnings Gods” & they will likely dictate the path of momentum over the short-term.. So let’s take it one step at a time here & get through the heart of earnings season first .. For now, we look for squeeze opps over the extreme short-term off weakness, bands of spec call sweepers in shorter term strikes work best there .. especially if they can catch bears leaning off-sides, there could be some solid movement out there …

PS: Sweepers can be as good as a momentum gauge as any in this environment .. Messy, mixed flow is usually a tell tale sign of chop .. but when that tote board lights up all green or red, that’s when we want to try & get involved .. remember, I’m referring to day trading or quick flip type trading at the most here .. For the next couple weeks, look at Sweepers primarily as an intraday momentum indicator & a powerful one at that.