Iran blinked and the markets are happy that there is no looming war or disruption in oil on the horizon (certainty). In looking at the charts, you will notice that we have had a sort of sideways action with little steps higher on the daily chart. As much as it seems like we are going up every day, we are really going up and down and staying in a range overall. This is more of what we expected with the weekly chart energy being now down to 24.
In fact, you can see on the weekly chart below that we have had essentially a sideways move the last 3 weeks. The trend is slowing and starting to walk more sideways in a range giving the flat, subdued market that I mentioned. We will have good up days and down days that match each other but trending another 200-300 pts. on the S&P is going to be tough right now.
This type of market is great to burn time on our positions helping us profit faster and with the swings up and down, it allows us to get filled on some of the extrapolation orders we have put in place, like the AMZN call spread order this week.
It looked into Tuesday AM like we might have to adjust the fill price to get it, but then we had the spike up in AMZN and just got briefly above the $4.00 mark long enough to fill. Now AMZN is back down about 25 pts. from that level. In fact, all our new trades for the week have filled (ISRG, AMZN, ABMD roll, CLR roll).
So, what now? I would not be surprised to see the market chop up and down through the end of the week. The daily chart is fully charged again, but I don’t think it can really trend straight up because of the weekly chart exhaustion. As I mentioned in last weekend’s newsletter, we are waiting for the market to tell us which way it wants to go for the next month or so. We may see that by the end of the week or into early next week.