Daily Commentary: September 11, 2023

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Look For A Bullish Day On 9/11

Posted by Peter Stolcers on September 11
www.oneoption.com

We will never forget!!

PRE-OPEN MARKET COMMENTS MONDAY – This morning the S&P 500 is up over 20 S&P 500 points and it will breach the 50-day MA. The market has been very choppy and this price level has been a magnet. This is a triple witching week and that increases the chances we will see a good directional move that includes a trend day.

The news has a positive flow to it this morning. AAPL is going to release a new iPhone Tuesday, AAPL will use QCOM chips for another 3 years, TSLA has a major upgrade, MSFT got an upgrade, META is working on a new AI platform (to be fair this headline can run daily for all of the tech giants), ADBE and ORCL price targets raised… On any given day, the news can run hot or cold.

The CPI will be released Wednesday. Thursday the PPI and Retail Sales will be released. The inflation numbers have not been generating big moves as they have in the past. The CPI is expected to rise .6% and the core rate is expected to rise .3%. Perhaps the biggest news of the week is the ECB rate decision. The odds of a 25 basis point hike are at 50%.

We should exit the summer doldrums this week and trading volume will gradually return.

I looked back at the price action on 9/11 since 2001 and 85% of the time the market has closed higher than the open. Wall Street for obvious reasons wants to support the market on this important day. We will never forget!

Overseas markets were up marginally. There is a bullish bias, but not overwhelmingly.

1OP is going to complete a bearish cycle to start the week. The SPY is going to open significantly above the 50-day MA and AVWAPQ. Our best day trading scenario today is a brief drift lower during the first 30 minutes with mixed overlapping candles. We want the market to find support above the 50-day MA. That would preserve half of the gap and it would be a sign that buyers are supporting this breakout. If we see this pattern, a buying opportunity will present itself on the bullish cross and that cycle should fuel a move above the high of the day. This brief bid check would give us time to find the best stocks and I believe this is the most likely scenario this morning. Tech should be strong today. If the market has stacked green candles and heavy volume (unlikely) we are going to see a nice rally that runs its course in 90 minutes and then stalls. I am not seeing the overseas strength to suggest that this is going to play out and the price action the last month tells us that sellers are always nearby. Gaps up have been challenged and many of them reverse. I am not expecting a gap reversal either. Typically, when we open through a major MA, the path has been cleared and the breakout holds. The reversals tend to come happen at  relative highs and when the market rallies to (not through) resistance levels pre-open.

I am expecting a quick bid check, support above the 50-day MA and a nice grind higher on 9/11.

The market has been choppy. We need volume!!! Without it, question every move. If we have good volume and follow through buying, take starter positions and add to them when we have confirmation (news high of the day and good volume with little to no retracement in the candles).

Support is at the 50-day MA and $445. Resistance is at $448.40 and $450.

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