Top 5 Weekly Trade Ideas #5 | SPX Triple Top or Rocket?

15 set

SPX came roaring back once again after the drop in the first week of September, much like August. The question now is do we get another rejection or a new ATH? I believe we'll find out soon enough as we have one of the most anticipated FOMC decisions in years this week. We've seen some extreme volatility since the beginning of August and I expect it to continue.

If you ask me, this cut will mark the beginning of the US recession that I believe will be much worse than anything we've seen in modern times. Some folks like Jamie Dimon are warning of that possibility as well, but many others are saying the opposite. The market may not tank immediately, if ever. So it's important to stick to the charts during times like these. I'd be cautious this week, but after the dust settles we should have a good idea of where things stand.

I remain in the bearish camp, but I'll be looking for longs if we rip past ATH this week. I'll be quick to stop out in the case we end up rejecting quickly back below for a big fakeout/bull trap. I currently have puts targeting August and April lows first, with a stop above ATH. The back half of September historically has seen the worst returns in each year. The first rate cut and yield curve inversion flip have also historically marked major market tops and recessions. It should be an interesting fall either way, hopefully with a lot of opportunity.