Looking for Trading Opportunities

It’s pretty comical that the futures are up four or five handles as you scroll through the headlines:

“AAPL logs a rare earnings miss.”
“Spain, Italy: too big to Save?”
“Europe Factory Woes Deepen”

Etc. etc. etc. I guess more talk of central bank action, and the WSJ article citing concerns and frustrations on the pace of the economic recovery pushing the Fed to initiate another round of QE in August instead September, is the reason we are well off the overnight lows.

The S&P was as high as 1380 last Thursday and has moved down 50 handles in the 3 days since. The Oscillator is -65ish “very oversold” so pausing or bouncing a bit in a lethargic summer tape isn’t out of the question. Markets did close below the recent trend line that has been in place since the June 4th lows. I think selling the retest of that spot makes more sense than buying for now, with some room to add if the bulls push the envelope!

SPX 1338-1342 is a spot that bears should defend to keep short term pressure on, and a spot to re-short if you covered into weakness and want to sell the rally. If the bears have ANY power, they won’t let the bulls reclaim 1350-1354 in coming sessions.

AAPL did miss yesterday. I mentioned yesterday this is the one of the rare occasions over the last few years that I would not have some type of long exposure heading into the earnings report. There were also opportunities to short it after hours if you were prepared with expectations. Today will be interesting. We need to see how much of the gap gets filled in order to judge if the street is giving it a quick pass. If not it may need more time and move downside for weeks or months to come. I do think the lifetime highs of AAPL are in just yet. It’s just a matter of what type of trade will it have moving forward.Last night, the pivot low was $565. The inside range for after hours was $570.50-$573.50. Above $574.50 there is an air pocket back up to $580-$582 and perhaps more. Under $565 the next big support is $558-$560 then a price point at $548! As much as I want to rush and buy it, I will be patient and look for a positive divergence at key price points. If you are looking to buy for the long term and cost average in, make sure to save some room, as the iPhone 5 is not expected until September or October. IF it’s October, the stock can have another mediocre quarter before it sees pent up momentum over new products and better earnings carry it higher. So the important buzz words to listen for moving forward concern the iPhone5 release date. September would be better for the bulls.

There’s not much to say about NFLX, it’s been a broken stock all year. It was a great trading vehicle and nothing more. They should look into who paid who to plan that “billion hours” story right around the time they knew the earnings. Maybe someone needed out. Hmmmm!

GOOG got hit yesterday and needs to hold $596-$598 to keep some new bullish constructive activity intact.

FB earnings are tonight. Everyone is already talking about judging other metrics besides earnings. So many have bashed this stock, that maybe it can go higher because people are scared to own it. Levels of support are $27.15 then $25.52. Levels or Resistance are $29.50 then $30.55 and then a big one at $33.55ish. I got stopped out at $30.25 and will look to trade it after the report.

Gold actually gave a positive divergence yesterday as the Euro was under pressure, and is now up today. The range got much tighter. I’m not saying the composure has changed, but it’s worth a look. If it can get and stay above $155.17, perhaps it can get some momentum. The major intermediate trend line stands at $157.50-$159.50.

Disclosure: Scott Redler is long SPY puts

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