Managing Risk for Next Week
Levels for SPX, Magnificent Seven, Megacaps, ETFs, and Crypto. Don't fight the rally, but stay aware of the limited room for failure
The S&P 500 closed at 7500.6, up 1.1% on the session reclaiming its central weekly and monthly levels in the same move. The session brought a bounce from yesterday's breakdown. The price action showed indecision rather than strong conviction closing the day without a clear directional candle.
Worth noting: SPX is sitting very close to its central weekly level for next week (CWL, details below), meaning that line is being tested right now. The recovery of both the CWL and the CML today is a constructive short-term development, and holding them through the next session will be essential to keep momentum and break above the bearish diagonal. The Stochastic crossover suggests caution, most of them have been validated, losing next week’s CWL would be a validation sign. For the bullish scenario, it’s unlikely to see a divergence like the one observed in April, since the price is not that oversold.
The Support and Resistance Levels updated for next week are here, they worked to set the bullish and bearish targets for the setups studied a week ago.
These levels are modeled every Friday for you, providing the information needed to assess risk and reward before the market opens on Monday. You don’t have to wait for the opening bell to decide your plan and which securities to trade; you have here the distances to essential levels and the setups suggesting whether they will act as support or resistance well in advance, so you make informed and serene decisions ahead of Monday morning.
Last night I posted a guide about how to manage these levels using setups from this same week. Get access here:
The levels below are modeled every single week or the following securities:
Indices & Futures: SPX, NDX, DJI, IWM, ES=F, NQ=F
ETFs: SPY, QQQ, SMH, TLT, GLD, SLV, DIA, VXX
Major Stocks: AAPL, MSFT, GOOG, AMZN, NVDA, META, TSLA, BRK.B, LLY, WMT, AVGO, COST, JPM, XOM, PLTR, NFLX, V, AMD
Crypto & Related: Bitcoin, Ethereum, ETHA, IBIT
Leveraged ETFs: TQQQ, SQQQ, UDOW, SDOW, UPRO, SPXS, URTY, SRTY
If you invest in some of these securities, this publication is for you.
When you subscribe, you also unlock all my Market Intelligence Hub, including educational content, 2 eBooks about technical indicators with real life charts, and special research focused on the SPX.
Let’s begin.
WEEKLY LEVELS
The divergence between growth sectors leading and Financials trailing is an interesting mix to watch, particularly if rates or credit concerns are weighing on XLF while semis and tech rally.
The percentages highlighted in red show the price move each asset needs to recover bullish momentum; the green cells in the same column show the maximum downside tolerance before flipping to bearish conditions, see how despite the bounce, there is very little room to the downside for the SPX next week while the Dow Jones is already below the key level: