Looking at GEX Ahead of CPI, Consumer Sentiment Friday
Just yesterday we were discussing 7600 as a potential target, 36 points lower than Wednesday’s close. Today’s gap down brought us below 7600, and the close at 7691.7 leaves open the possibility that we tag the remaining two GEX clusters that we discussed in last night’s newsletter: 7550 and 7500, the 2nd and 3rd largest net GEX clusters as of Wednesday. 7500 remains large as of Thursday’s close, so we may end up tagging that level. We’ve had 4 red days in a row, so the odds of a 5th red day are low, especially with tomorrow being 9/11, but we will be prepared for the unusual as we see the initial reactions to CPI at 8:30 AM and Consumer Sentiment at 10 AM.
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SPX on its way to the Weekly 15 EMA, Most GEX 7500-7700 into OpEx Week
Selecting for next week’s GEX and this Friday, we see most GEX between 7500 and 7700. Interestingly, if you simply remove Friday 18th GEX, the picture becomes lopsided negative, which you’ll see on the 2nd picture. SPX remains above the weekly 15 EMA at 7544, a mere 46 points lower, so we may see SPX test that level even if we don’t touch 7500 tomorrow. The weekly Keltner channel still looks bullish, and this multi-week consolidation can still resolve in bullish fashion, particularly if 7500 holds.
Take Away Next Friday the 18th and the Picture is Markedly Bearish
I’m not sure what to make of the almost one-sided negative picture between now and next Thursday, then all of the positive GEX showing up for Friday the 18th. I think the important aspect in my mind is the lack of meaningful GEX below 7500, which may mean we can see a big bounce into FOMC and OpEx from the 7500 level. Note that net option activity was positive for both SPX and QQQ today. We’ll be keeping an eye on this Friday.
Key Levels: Bullish above 7600 targeting 7650, 7700. Bearish below 7600 targeting 7544, 7500.
QQQ Still Hasn’t Touched 700, 60-Minute Chart Suggests Bounce Potential
Perhaps thanks to one-off Mag 7 rallies (such as AAPL today) and the semi/software rotation, QQQ still hasn’t visited 700. I think QQQ has good odds of reaching 700, but we’re near the lower Keltner around 705 on the 60-minute chart, with the HMA almost to the bottom. This is a setup for a bounce higher, in my opinion. Downside risk is currently to 700, barely 1% lower, but more bearish outcomes may be possible below 700.
Key Levels: Bullish above700 targeting 715, then 720. Bearish below 700 targeting 690, 685.
Geek Market Velocity Signals Providing Good Setups, but no Signal Lately
Our newest tool provided a buy signal on the 10th, with a tiny little spike right after the signal triggered. It’s unclear whether or not we’ll see more upside following the buying pressure signal, but looking back further shows nice follow-through on the buying pressure and dealer absorption signals. This is one additional data point we’ll be using intraday Friday to identify potential signals that can uniquely identify possible pivots.
There’s no livestream on Friday, but we hope you’ll join us in Discord where we’ll share what we’re seeing.
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