© Copyright 2025 eOption, a division of Regal Securities, Inc., Member
FINRA/
SIPC |
Important Disclosures
950 Milwaukee Ave., Ste. 102 | Glenview, IL 60025
The information on this web site is for discussion and information purposes only. All accounts accepted at the discretion of eOption which accepts customer orders only on an unsolicited basis, and does not make any recommendations regarding any security or securities product with the possible exception of orders executed by our full service bond desk. Nothing contained herein should be considered as an offer to buy or sell any security or securities product. Online trading has inherent risks due to loss of online services or delays from system performance, risk parameters, market conditions, and erroneous or unavailable market data.
FINRA BrokerCheck reports for Regal Securities and its investment professionals are available at www.finra.org/brokercheck.
Options Disclosure: Options involve risk and are not suitable for all investors. Prior to trading options, you must be approved for options trading and read the Characteristics and Risks of Standardized Options. A copy may also be requested via email at support@eoption.com or via mail to eOption, 950 Milwaukee Ave., Ste. 102, Glenview, IL 60025. Online trading has inherent risks due to loss of online services or delays from system performance, risk parameters, market conditions, and erroneous or unavailable market data.
eOption Commissions: Broker-assisted orders are an additional $15. Option strategies involve multiple purchases; therefore your transaction costs may be significant for option strategy trades. A commission rate of $2.00 for equities and $3.99 + $.10/contract for options, per execution, applies to orders entered and filled by eOption's Auto Trade Desk and does not apply to customers who enter their trades directly into the eOption platform and are not utilizing the Auto Trade desk.
Broker Comparison: The competitor rates from published websites were verified on 05/25/2023 and are believed to be accurate, but not guaranteed. Commissions are subject to change without notice. At some firms, commissions may not reflect broker-assisted fees, orders over 1,000 shares, penny stock trades, OTCBB, pink sheet stocks or foreign stock orders. Firms may offer reduced commissions if additional criteria are met.
Blog & Commentary: eOption is neither affiliated with, sponsored by, nor endorses commentary and the opinions expressed are solely their own. Content is provided for educational and informational purposes only and eOption cannot attest to its accuracy or completeness. No information provided has been endorsed by eOption.com and does not constitute a recommendation by eOption to buy or sell a particular investment. You are solely responsible for your own investment decisions, and eOption makes no investment recommendations and does not provide financial, tax or legal advice.
Market Makes All-Time High
www.oneoption.com
Institutions decided the FOMC Statement was bullish!
PRE-OPEN MARKET COMMENTS THURSDAY – After the biggest rate cut in years, the market barely moved yesterday. That was a little puzzling since a 50 basis point rate cut was the best possible scenario. The Fed is dovish, inflation is easing and economic data points remain stable. Powell said that they are not going to wait for a downturn in employment to act. The Fed doesn’t see any warning signs and they are being proactive.
From a technical perspective, we have a Cup & Handle breakout on a D1 basis. When we make a new all-time high, we want to obliterate the old horizontal resistance and we are doing that this morning.
There is an important consideration. This move did not happen during normal market hours when the large institutions were active. The price action overnight can often be misleading because there is not much volume. This is a triple witch and an overnight move of this magnitude is going to force some major adjustments on the part of proprietary trading firms that means that it is exaggerated.
Gaps up to an all-time high often result in a gap reversal. This is true, but that is more common when the gap up takes place during a straight shot higher. That’s not what we have. The market hit resistance and it has been gathering momentum for the last six weeks. Now it is breaking out. This is a much healthier backdrop. Massive gaps up also tend to be “stickier” and we don’t see as many gap reversals.
So how do we trade this? I would watch the opening price action and I would be 100% fine with letting a “Gap and Go” run without me. These are pretty rare at an all-time high. Watch the price action unfold. A deep swift drop after the open would suggest profit taking and I would hold off on longs. A wimpy bid check with mixed overlapping candles would be a sign that buyers are interested. Then we would have a good entry point for longs. TAKE ALL OF THE STOCKS YOU LOVE THE MOST AND SET THESE TWO ALERTS. 1. M5 > VWAP. Most stocks will open above VWAP. You want a shot at them when they retrace and get back above VWAP. 2. M5 Buy Signal. Most stocks will be on an M5 buy signal. You want them to go to an exit which will happen on a dip and then to go back onto a buy signal. When you get that alert, evaluate the dip.
From a swing standpoint you can take some starter longs. There are no bargains at an all-time high with stretched valuations so don’t chase and don’t load up. We can expect that the breakout will be tested and I feel there will be plenty of opportunities to add to swing longs. We want to make sure this breakout holds.
Support is at SPY $565.
Content is provided by OneOption, LLC, which has no affiliation with Regal Securities, Inc. (“Regal”) This commentary is provided for information purposes only, and is not a recommendation, offer or solicitation by Regal to buy or sell securities or to adopt any investment strategy. Regal has not participated in the creation of the OneOption content and does not directly or indirectly endorse the content. Any reliance on this material is at the sole discretion of the reader.