Daily Plan 2/14/23
Danger Zone
Folks-
The primary expectation for the weekly plan and auction from Friday was to remain supported at 4050-4080 area and retest some of these levels around 4130.
This was indeed the case as we saw the Friday’s auction continue on to Monday, slow drift up into the 41304150 area to close the session near 4150. Personally I am not a big fam of these type of days intraday as there was barely any pullbacks or retracements and the auction remained one way steady drift up.
As it is the CPI day, I do not have a super formal plan but will share levels if I see any updates in the AM. Below Chat room is where I will be sending out the updates.
Also, last day today for the offer below in case any one missed the bus last time.
Some other names that did well today included PLTR which is a newsletter stock and I called a bottom on it near 6 bucks. It was up more than 20% today and I do think this has seen the lows for a long time.
Also saw about a 7% up day in INTA shared last week. Action in this continues to look good. Both ideas shared here in the Stack amongst several others.
Also saw good action in NQ again off the key 12235 level on Friday which was almost the low before another 300+ point rally off these lows.
With the CPI tomorrow, the general trend has been that the markets have rallied in days and weeks after the CPI from last 6 months or so reversing a trend established earlier in the year. This particular CPI will need to show that the FED actions are working and we are on a sustained downtrend in the CPI.
This is a high stakes CPI. The expectations are very high. A miss will be unforgiven. I am expecting a high likelihood of a surprise in this CPI. The Month over month is expected to be 0.5% increase due to higher gasoline prices which we had called here in this Stack. However, the consensus on the overall headlines inflation number seems to be 6.2%, a drop from prior 6.5% which is a little strange.
Minus a very weak CPI, I think we can sell off in the S&P500 index as the expectations will be very high from this CPI. The CPI calculations have also been changed by the BLS. Read the post at the end for more on that.
As far as levels go, the news comes in an hour before the cash session open. I think 4150 level is very important and if we open below 4150, I do think we are going to go for a test of 4080-4090 area. A break of 4080 then could target 4050.
For the bullish action to continue into 4200 where I think longer term sellers could reemerge, we will need an IB close above 4150. At time of this post we last traded 4150.
There is quite heavy put built up in SPY and QQQ for the 17th expiry with OTM deltas. This can very well be hedging but 12235 I think is a key level in the NQ and I do think a loss of this level opens doors to more selling for rest of the week. This could correspond to about 4070 in Emini S&P500 a break of which I am expecting heavy selling. This goes both ways - so for the bears, this I think is what they are looking at to take out for heavier selling to come later. If the bulls can defend this level, 4200 remains in play IMO.
~ Tic Toc
Stay nimble. Do well.
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