Welcome ladies and gentlemen, this is Robert Roy of WealthBuildersHQ.com, which is for Friday, July 16, 2021. TGIF, baby! It’s coming. The markets just closed. It’s about 6 or 7 minutes after the hour, so let’s go take a look, starting off with the S&P 500.
We had a little bit of a pullback again today. We closed near the 8 EMA, which shows some strength. But, that rounding top does concern me a little bit. We’ve had an increase in volume even though we’ve come down a little bit in the market, so are the bears starting to pick up some strength, some gusto? Not sure, but we’re going to check it out that way.
So, let’s go take a look at our candidate for today which is SPOT. Let’s take a look at what’s going on there. First, as we always do, let’s take a look at the Fibonacci and talk about that first. We’ve got a great V-top in here, a nice move to the downside, a pullback and a good bounce – we made it up to the .236 which is hesitation. We broke out of the zero-line once which was a head-fake. This one was a nice entry. Moved well, well beyond well. Came back again, broke through and bounced, and then we broke through again yesterday. Today we actually ended up continuing. I looked at this one yesterday and did not think it was going to work out, picked a different candidate instead and it was a good trade setup on this.
So, what are we looking for? On SPOT, I need a move back up to the 254.92 level. It’s already down at its target so it’s moved too far, but it happened very quickly. You’ve seen in some of these stocks that they take forever moving around in there, so I want to see if we can make a move back up to the 254.92. If we don’t, no harm, no foul. No trade taken. Walk away, call it a day. We just look for another trade another day.
But if we can and we get that rollover, 247 is your first target. You’re going to exit your first half of the trade at the 247 level, you’ll move your stop down where right now is at 257, move your stop down somewhere down below the 254.92 level. Basically, I want to break even. I don’t want this to go back above and have it cost you anything if you don’t get out of the second half of the trade at the target, and it moves to the stop at the second half, you’re stopped out with a little bit of profit, small cost, break-even…and that’s really what the goal is. Get through it without giving anything back on the second half of the trade. 238 will be the second target.
Well, what if I only have 1 contract? Then the entire trade is over at 247, you call it a day and move onto something else. It’s not that complicated of a setup, but for this, it MUST retest the 254.92 level. If it doesn’t, no trade.