Traders Profit On Expiration Monday
What Monday’s Action Tells
You
Once again, the Monday following a March
expiration was down with the SPX
(
$SPX.X |
Quote |
Chart |
News |
PowerRating) -0.5% to 1183.78 and the
Dow
(
$INDU |
Quote |
Chart |
News |
PowerRating) -0.6% to 10,565. The Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) was unchanged and
the
(
QQQQ |
Quote |
Chart |
News |
PowerRating) +0.2% to 36.58. The SPX intraday low hit 1178.82, just beyond
the
-1.5 volatility band of 1179.24 before reversing up to 1187.10 and fading to
the
1183.78 close. Nice trade. The
(
TLT |
Quote |
Chart |
News |
PowerRating) was -0.3% and the Dollar +0.9%,
while
the XAU ended at -2.7%. In the primary sectors, the
(
SMH |
Quote |
Chart |
News |
PowerRating) was +0.1%,
while
the XBD, BKX and RTH were all about -0.8%. NYSE volume was 1.85 billion
shares
with the volume ratio 32 and breadth -1314.
With the renewed focus on inflation and
interest
rates, we have the Fed rate announcement today at 2:15 p.m. ET, in addition
to
the PPI at 8:30 a.m. The now obviously flawed CPI reports on Wednesday. With
the
Generals on the fence and the current nervous market, as it always seems to
be
after a decline from a rally high, the price action following these kinds of
reports can be accelerated more than usual by the futures and program
activity.
That spells opportunity for the daytrader.
There was significant confluence yesterday as
the
SPX hit an 1178.82 intraday low, just below the 1179.24 -1.5 volatility
band.
This was followed by the RST long entry above 1180.04 which traded up to
1187.10
before fading to close at 1183.75. There was also some extended-level
confluence
which was mentioned in yesterday’s commentary. The daily chart potential RST
long setups moved lower as there was a lower low and high, which means
(
SPY |
Quote |
Chart |
News |
PowerRating)
118.78 and the
(
DIA |
Quote |
Chart |
News |
PowerRating) high of 106.12.
Sequence traders should be aware of
both the three-month and 20-day bands because the SPX and Dow are into the
price
zone. The SPY hit 117.76 vs. its three-month band at 117.50. Any weakness is
a
short-term long position opportunity for what would be the “B” leg
of an ABC
move and some retracement to the 03/07 highs.
Have a good trading day,
Kevin Haggerty
P.S. I will be
referring to some charts here:
www.thechartstore.com in the future.