Afternoon/Morning Notes – 7/22/2022

Good Morning:

• This is a very important video. Do not skip it.
• We are looking for the market to pin at 4000 or ping pong between the WEM high at 3964 and 4000 at weekly expiration today.
• 4000 is the key Gamma strike on the board and formidable resistance in and of itself.
• As with all expected moves, the dealers will lose a fortune if the S&P 500 Futures close above 3964 today, so they will fight to bring it back into the WEM range.
• The Daily Expected Move would allow for an intraday move up to 4040 before rolling over.
• As with this morning’s video and the one referenced above, “X” marks the spot between 4070 and 4180. There is considerable resistance from about any angle you can imagine starting at 4070. Think of it as Grand Central Station.
• The 4070 level could also be the end of an Expanding Flat pattern, leading to a reversal and resumption of the bear market.
• Any such reversal would indicate an unusually weak launch and left translation for the 40-week cycle. I have never seen one reverse this soon, but it is not impossible.
• As usual, I doubt I will trade tomorrow as it is weekly expiration – but keep your phones on for any alerts.
• We are back to cash in the swing strategy, selling our calls yesterday when the futures hit 3980 for some excellent gains.
• Spike Rules loosely apply at the Open today (not the biggest spike I have ever seen), so be sure to review the rules.
• There is nothing in particular to be gleaned from the Globex action last night. The market will open near the top of yesterday’s range, which is bullish but with the caveat that the WEM may pull it south to 3964 before the close.
• We could also seee some pinning action around 3950.