Last updated on November 6th, 2020
Coming into this week, all eyes were on the outcome of the elections. No surprise that the results aren’t finalized yet but the market so far is thrilled with the likely outcome. We have been in rally mode since Friday last week with the Nasdaq again leading the charge to the upside.
The Nasdaq ETF (Symbol: QQQ) is up over $25 since Friday of last week.
For the last number of weeks many traders were taking a wait and see approach until after the elections. Now that we are moving past the event, volume has been impressive showing conviction behind the move.
We are seeing volume in the 80-125 million share range on a daily basis on SPY which is great for active traders.
Next Resistance Zone
The next areas of resistance on the upside on SPY is the $350 level. Should we break that level we have a swing level up at $354.00 and then the all time high at $358.75.
With price again extended, we would be looking at these resistance levels as areas where we could potentially see another pullback to the downside. Ideally we would love to see a pullback over the next few days to build some additional energy for a move back towards the all time highs into the year end.
We do need to be aware of a potential sell the news event once the election results are finalized. Should we get a deeper selloff over the next week we have a box of support between 330-340 on SPY where numerous moving averages are located on the daily chart.
In this week’s Midweek Options Update video, we will walk through the chart levels mentioned above in more detail. We also talk through how the elections could change our trading for the rest of the year. Finally, we take a look at a handful of trades setting up for the rest of the week.
Take a look and feel free to contact me with any questions you might have. firstname.lastname@example.org.