9 Minute Read

Tackle Today: They Bought the Dip

November 18, 2022

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«No surprises there.»

Traders,

Yesterday’s down gap and test of the rising 9 EMA was gobbled up by bulls. Their zeal is continuing this morning with a modest up gap that, hopefully, will carry us back to the pivot high near $4000 on the S&P 500.

There’s a lesson in this week’s price action that should be obvious.

In an uptrend, dips get bought!

Higher pivot lows and higher pivot highs define an uptrend.  The recent rally carried stock indexes to a higher pivot high – with a burst of momentum, I might add. Pullbacks from such a position should always be viewed as a buying opportunity.

You never know where they will pounce, but history provides clues. The strongest trends see buyers return at the 9 EMA. Those less so may not find support until the rising 20-day or even 50-day.


Video Of The Day: What is Beta Weighting

Beta weighting is a way that investors gauge their portfolio directional exposure (Delta) by normalizing it to a standard benchmark, in this case, the SPY (S&P 500 ETF).

Beta weighting the portfolio Delta serves three purposes:

✅ Assess the total risk of a portfolio;
✅ Calculate a portfolio’s expected move;
✅ Compare relative risks between stocks.


Chart of the Day: S&P 500 (SPY)

Chart of the Day: S&P 500 (SPY)

$390 is new support. Break it, and things get dicey. Hold above it, and long live the uptrend.


Options Theory Blog

Evolution of a Naked Put

Today’s video delivers a fresh spin on the naked put. Within, you’ll learn how delta, theta, and vega play together to drive your position’s performance.


Today’s line up

Traders Lounge 11 AM EST

Join the coaches in this live lounge, ask questions, discuss ideas or just sit back and listen to veteran traders discuss market conditions.

Cash Flow Club Replay

If you missed last night’s webinar where Coach Gino Poore talked about Using Thinkorswim (TOS) to screen for Covered Calls or would like to watch it again, check it out here.

Halftime Report 12:30 PM EST

The Halftime Report starts at 12:30 EST and covers what news is driving the market, chart analysis from the movers and shakers of the day, and fun in a way that only Matt and Tim can deliver.


Tackle Trading: Financial Freedom is a Journey. Sign up now for a 15-day free trial.

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