The coming week will have some serious breakouts, blowouts, and wide ranges in prices, as well as continued “freight train-steamroller” trending behaviors. Gold is in a more extreme narrow range with strongly-trending monthly and inside weekly pivots more breakout-ish than last week as of Thursday. evening. The S&P 500 seems to be planning a big drop, according to one of my early detection systems (Extreme Candle $TICK) shown in a chart below.
I envision/imagine sudden bad news to be the catalyst for the S&P 500 drop already setup in the charts for a fast move back down into fair valuation, with mild hesitation due to the bullish monthly chart- resultant suggestion: use a defined-risk short call spread on weekly issues expiring next week with no more money than you could throw away and not miss, if your research/charts also show bearishness. Crude, the yen and the euro, Bitcoin, as well as the S&P 500 have narrow ranges and trending pivots as a recipe for breakouts/blowouts- all seemingly bullish except the S&P. The lonely sideways pivots candidate for a narrow range next week is Soybeans that already made a wide-range move down and is a weekly Iron Condor trade (slightly bullish skewed) set-up right now to place Friday, June 8.
Regarding this week’s forecast ending June 8, almost all predictions worked, except the gold blowout waited another week to strengthen its force. I was right about the yen downage, but it may not have been enough for a straddle/strangle to have been profitable. The great news is it is in an even more narrow range with trending pivots for next week’s big move, as are almost all the other symbols. I was wrong on the S&P 500 drop this week, and I sound like those guys that toll the “big crash” date forward in every newsletter they write until they are right. It is next week -- not a big crash, though!
Quick Technical Assessments/Trades for the week of June 11
S&P500 Is in narrow ranges on multiple time frames with trending pivots, and directional guesses are merely that. Bearish on sudden, unexpected bad news, possibly sharp V-bottom reversal back into range afterward. Short call spreads on any Friday upticks.
Yen Is in narrow ranges on multiple time frames with trending pivots, and directional guesses are merely that. Bullish. Short put spreads, if you can time a snap down.
Eurodollar Is in narrow ranges on multiple time frames with trending pivots, and directional guesses are merely that. Bullish. Short put spreads, if you can time a snapdown.
Gold It has extreme trending pivots both on the month of June and next week with inside breakout setups as of Thursday. night. As last week, “Join the trend, if that’s your thing (narrow-range breaks)” and, same as last week, “My ranges will be less accurate for this one, and price may blast past my extrema on 1 side.” Maybe a strangle or, if I’m right that it breaks upside, buy a long call overhead (to make it cheaper and to get bigger profit) and use a short call spread or long put spread to offset the losses if wrong but wanting some of the other side’s trade.
Crude oil – Is in narrow ranges on multiple time frames with trending pivots, and directional guesses are merely that. Bullish- I had a mental image of 3 green candlesticks on the weekly chart, but I can’t be certain that they would comprise Wave 2 up before wave 3 down or simply be part of a consolidative busted wave pattern before more rallying. Short put spread, if you can time a snapdown.
Soybeans Already made a wide-range move on many time frames within contexts of sideways pivots. Pick some strike prices near delta .20-.22 for the put spreads and delta .15 or so on the call side when constructing your weeklys Iron Condor (960/55-1015/1010strikes?) to sell time decay, volatility collapse and a slightly-bullish opinion on price. Again, you sell an Iron when expecting sideways action whereby you want options to decay in price, time to pass with no price action and a decrease in volatility to buy back the Iron lower. We are bounding price between the strikes on this one.
Bitcoin Some technicals are bullish for next week/month, It is in narrow ranges on multiple time frames with trending pivots, and directional guesses are merely that. Bullish. Ignore this symbol, maybe, until a cryptocurrency index is created and has a futures product and options.
Next Week’s (Ending June 15) Predicted Ranges: Caution: Less Accurate Due to Trending
High: 2799/Low 2734
High: 9190/Low: 9054
High: $67.04/ Low: $64.41
High: $10.13/Low: $9.60
High: $8,100/ Low: $7,375
Note: The technical format change offers numbers likely to be hit/exceeded versus zones.
Projected & Actual Ranges for the week of June 8 (as of June 7 afternoon)
High: 2737/Low 2695 Actual 2779-2729
High: 9268/Low: 9128 Actual 9150-9075
High: 1.179/ Low: 1.163
High: $1,317/ Low: $1,296
High: $69.03/ Low: $65.59
High: $10.34/ Low: $10.10
High: $8,020/ Low: $7,115
The weekly Eurodollar chart shows a weak breakout on lows as predicted last week with overhead targets between current price Thursday evening and low targets from the signals I showed earlier a few months ago as red lines. It is a bull countertrend bounce, though maybe not as bullish as the bear trade down was. CCI has positive divergence, and Fisher shows momentum arrows upwards, supporting the trade. At 2 a.m. weekly candle had a tail on top indicating a long using a short put spread could be made on a throwback down with 1.198 the weekly 50-moving average as a reasonable bounce-up target. Source: Think or Swim
This crude oil weekly candle chart shows a green hammer on the 20-moving average. This extreme valuation candle would be a better trade with some momentum arrows up, and if any momentum up on Friday occurs, this bull trade is for three to four weeks in options spreads. Warning: It is Thursday night (June 7) when I am writing this, and that hammer could be a bear red candle or any other type of candle signal by Friday close, making it less of a bull situation. 2 a.m. CST Friday became a red hammer! Even if the candle closes as a deteriorated situation, I still see the spread between fast and slow Fisher lines and the similar CCI spreads, both supporting the trampoline quick bounce after a lower price long entry one should wait for. Source: Think or Swim
TICK strength flashing a downdrop extreme candle valuation on a weekly hart time frame, so monthly options may apply if shorting the index futures using a short call spread or other defined-risk approach appeals. This chart is the reason I expect a sudden news-based downmove next week. My rationale: it would take unexpected news to spark the fast drop or reversion back toward fair valuation that this type of setup resolves into. Source: Think or Swim