 Hey everyone Lilo here smartoptionseller.com. How's everyone doing today? It is Saturday September 18th, 2021 Welcome to another edition of our Saturday synopsis Saturday YouTube video What we like to do here is we like to take a look at the charts the indexes Individual stocks. I try to help you gauge where the market has been and where the market might be going We do that by looking at charts. We look at support and resistance levels We look at moving averages. We look at other technical indicators That is what's called technical analysis chart reading and that is how I base my own trading and the trading for my newsletters that I run when I Help people try to gauge where stock might be going and then we take the appropriate Option trade we sell put options. We sell put option spreads here at the smartoption seller and those are mostly bullish trades So we're always looking for bullish stocks and the way we do that is we just look at the charts Over and over and over again All we do is look at charts trying to gauge where stock might be headed and if it looks like it's headed higher Then we engage with a put trade a put sell trade or a put option sell Spread trade. Okay, so let's just jump right in and go right to it and before we start that just want to remind you You can always subscribe to this YouTube channel You see that red subscribe button in the bottom right hand corner of the video Please click on that. You'll never miss a video you turn on your notifications and every Saturday I usually put out another one of these so don't forget to subscribe. Okay, so let's jump right in what we like to do is We like to take a look at the SPY Which is the exchange traded fund for the S&P 500 which I view as the the broadest measure of the market as a whole So we like to take a look at the S&P 500. We'll look at the Nasdaq and the Dow Jones industrial So what do we do here? If you've been watching these videos over time You know that I like to talk about what we've seen in the past Patterns that are developing and try to get a gauge of where a stock might be headed next now When you're looking for bullish trades is such as we are we always want to see the stock or index in an Upwards momentum meaning if you're looking at a chart like this, this is roughly two years worth of Of a chart on my screen the real estate here So we want to see a chart moving from the bottom right I'm sorry from the bottom left to the top right. That means it's moving upwards Okay, and what I look at here is a daily bar chart every one of these lines that you see one of these Long vertical or short vertical lines is one day's worth of trading Now depending on what type of trader you are if you're a hyperactive trader where you can look at one minute bars We can change these to one minute bars If when my chart loads up here each one of these lines is now one minute's worth of trading So these are very very short term. These are for very hyperactive traders that are maybe looking for patterns And you know if that works for you great, but we focus on the daily chart which is each one of these bars or lines is One day's worth of trading and then we can also go back And we'd like to back it out even more. We look at the monthly chart So one each line here is one month's worth of trading. So this goes back to sometime in 1993 We can see the market has moved up greatly over time, especially since 2009 when we had the the financial crisis and the market's just gone up since here this big Dip here was March 2020 when the pandemic hit, but we've gone straight up since then So we like to take a look at the daily chart because most of our trades are in the one to three month range And so we concentrate a little bit longer time frame, which is daily chart. So what are we seeing on the charts? This is the s and p 500 is represented by the sp y which is exchange traded fund We like to watch the stock that is in an uptrend and in the stock market Just like physics. I bring this up every week That a stock in motion will stand is will tend to stay in that motion until something comes along and knocks it In the other direction. It's just like physics an object in motion Stays in that same motion until something comes along and knocks it in the other direction That's how stocks work to they work on momentum And as long as the company itself remember these this is an actual company These are actual companies that create actual products that people actually buy So as long as companies are creating good products having increasing sales quarter after quarter Then the stock price will follow over time in the upwards Direction. Yes from time to time. There may be a bad or a worse than expected earnings Which could knock the stock lower same thing with the indexes. They they they move up and down This is normal ebb and flow now What we're seeing in the world is of course the pandemic the covid pandemic is still out there Countries are trying to vaccinate their citizens It's happening so and There's really nothing as I see it that's going to derail this uptrending market Now there's a lot of narratives out there about well, the us federal reserve is going to start raising interest rates at some point Uh, you know the pandemic has created lots of troubles. You got a lot of supply shortages World turmoil. I mean, there's so many narratives out there that one could think that We have to have a bear market There has there's so many bad things out there in the world that it's going to knock this stock market down Now If you've been watching history over time now, let's go to the monthly chart Between 2008 2007 when this the financial crisis started happening till now look where the market has gone Okay, so during that time there's always been, you know, world events pandemics financial meltdowns Crises overseas depending on what country you're living in I mean, there's always going to be bad news, right? There's always going to be bad news out there But the market tells you otherwise All right, the stock market as I said is made up of companies that create products and as long as those companies create Sales that are growing each quarter The stock prices have to follow it upwards You're never going to find a company that has good sales quarter after quarter where their stock price goes down It just doesn't happen And so that's what the stock market is made up is made up of companies that are creating products and sales And their earnings are driving higher all the time And that's why the stock market goes up in addition to that the stock market compared to bonds CDs real estate gold whatever There's you're not going to get any other kind of return on your money other than in the stock market itself So yes, we have this push That that raises the stock market because so many people are playing in it because that's the only place where you can get A return on your money But the underlying fundamental is still that it is still made up of companies that are creating products that are creating increasing sales over time so the the narrative that We can't go up any higher It is a false narrative. Yes. We will have pullbacks from time to time Obviously, you can see it goes up goes down goes up goes down But in the long run it goes up over time in between these pullbacks so What do we do? How do we how do we make our trades? Well, you know our time frame is typically one to three months out in time So we have to follow The way I do it on my charts. I have a 20 day A 50 day and a 200 day moving average Those are the three moving averages that I tracked to help me gauge where a stock might be headed and down here Is what's called the rsi indicator and is an it is an overbought oversold momentum indicator tells you when A stock or index may be getting a little overheated or too much selling happening Okay, but a majority of time it fluctuates around this 50 level. So The range is 100 to 0 obviously for the rsi I use the 80 level and the 20 level to tell me if and when a stock or index may be getting A little overbought or oversold, but majority of time it will fluctuate in that 80 to 20 range somewhere in the middle and as the stock moves up You can see that it just kind of Hovers around that 50 level, you know up or down in between that So what we like to do is we like to follow the 20 day the blue 20 day and this red 50 day most stocks majority stocks on the short term time frame Will will hug along the 50 day or 20 day moving average and when it pulls back to one of those It typically will bounce after a number of days now. That's What I base my decisions on knowing that there's really nothing to derail The up trending market. I I watch for the pullbacks. You can see here's a pullback Here's a pullback. Here's a pullback. Here's a pullback and every time The market regains its footing and goes back up here Here and where we are right now. We've had some selling in the last two weeks of the market people getting a little nervous But The s and p 500 has just hit all time new highs right around september 1st Right here. Okay. How can you complain about a market that's been going up up up like this and then has a little bit of a pullback It shouldn't make you too concerned Because that's what the market does where you concerned when it pulled back here thinking, okay The bull market has ended now. We have to have a bear market. Were you thinking the same thing here? Maybe you were thinking the same thing here and here and here Why does the market keep going up? Because it's made up of companies that put out actual sales So yes, the last two weeks we've had some selling In the stock market and we don't like to see a lot of selling like two weeks worth of selling This can make a lot of people nervous if you're a shorter term trader if you're not really Focusing on the long term trend We had a little two-week break here. We had a you know a week here a week here But look what happens it keeps bouncing up. So to me I'm waiting to see okay. I'm watching this very closely. We closed below Yesterday friday september 17th below the 50 day moving average. Okay, so what I like to do is watch it for the next couple days Watch for the next couple days because I have like this This loose three-day rule where I like to see whether it can it will trade more than three days below a major moving average like this So you can see it went below it a little bit here went below it a little bit here for two days What else we have here? We had About two good days below it but still bounced up So, you know, we may have this normal ebb and flow and maybe next week The market will regain its footing and continue on with its momentum higher. Like I said I don't really see any narrative out there. That's all of a sudden going to knock this thing back down now seasonally August and september are the worst or the weakest months in the year for the stock market and we're right in that Middle september So this could be the the the selling that we've typically see in august and september and these last few months of the year Really end up being very strong months. So watch this for the next couple days I have a feeling the market will regain its footing and go back up higher Where else are people going to put their money? Yeah, we may have a little more selling But eventually people will realize Stocks are where it's at. We got to get in the stock market. So it'll go back up But if you're a hyperactive trader and you're playing here and you know, you bought some stocks up here Yeah, you may be a little nervous. So watch the 50 day moving average. That's what I do Let's take a look at let's back out here And here's the here's the e-mini s and p 500 futures contracts which trade almost 24 hours a day during the week So the same thing you can see that it's it's it came down to the 20 the 50 day moving average Just like this one this one this one this one so Odds are It's going to regain its footing and move higher. Okay, so we're watching that Let's take a look at the nasdaq. We'll look at the nasdaq futures and the nasdaq composite itself the nasdaq futures Uh, it was finding support at the 20 day moving average But it closed below it yesterday friday september 17 So maybe we'll see a little sell off early mid next week. Maybe to the 50 day moving average You can see it also hugs the 20 day And sometimes the 50 day moving average now here it's met a couple maybe almost a week below it But regained its footing. This was back in um, may So let's like let's take a look at the nasdaq composite which is doesn't trade as many hours as the futures So here's the nasdaq composite blow it up a little so you can see Blue 20 day moving average So it's kind of hugging or hovering around the 20 day trying to figure out where it wants to go It may come down. There's not a lot of lot There's not a lot more to fall to hit the the 50 day So we may see a a quick move down to the 50 day and a possible bounce. You can see same thing happened here We had a little move here. Um, I you know a while ago. This is a w pattern Which is typically a bullish pattern it blasts it out above the resistance line and moving higher So, you know the nasdaq and the s and p 500 I put a little more emphasis on because it has more stocks in it Whereas compared to the dow Jones industrial which is only made up of 30 stocks I don't think that's enough of a representative of the market as a whole But we look at the dow anyway now the dow this past week look at this really tight range here not a lot of A lot of not a lot of movement Yes, it's fallen below my support line that I that I've drawn in the past It looks a little jumbled here. I'm going to remove some of this stuff here And maybe get a different picture of what's happening You can always You know when you're when you're doing technical analysis, it's all about drawing trend lines and support and resistance But those change over time. So it's okay to redraw them from time to time So what I'm seeing is yeah, we still have if we want to draw some some newer trend lines here You kind of connect the bottoms. Okay, so we kind of have it looks like it may have fallen below An uptrending trend line, which is fine It has fallen below the 50 day and 20 day moving or it's kind of hugging around here But I think the dow sort of gets its Cues from the nasdaq and the s and p 500 So it's trying to figure out what it wants to do eventually I think with the rest of the market. It's going to come back up higher people Need to be invested they need to have a return on the money and stocks are doing well Companies are doing well earning seasons are usually do pretty good So the the stock prices will follow Eventually after we get these pullbacks pullbacks are part of the normal ebb and flow of the market You can see pull back here pull back here pull back here all these pullbacks But in the longer move you can see the upwards momentum So you have to have somewhat of a longer term view at least in my opinion if you're a hyperactive trader And you're looking at one minute charts, you know the market is so erratic in that short time frame It's very hard to gauge where it's going to go So we need to back it out and look at a longer term time frame. I'm bullish for the long run Why why would I be otherwise? Sure? We're going to have pullbacks and if you if you get into trades up here bullish trades Then you might have to invoke, uh, you know your your risk management plan. You may have to make adjustments That's just part of trading Okay, if you're going to trade and you're looking at shorter time frames Adjustments are part of the game. That's just how it is so I think the market looks good in the in the long run It has always looked good. I mean, of course the pandemic shook everybody out It was a very unique situation But once again companies are are are still operating Companies are putting out earnings good earnings good sales and the stock prices will follow So let's take a look at some individual stocks as we do. See what's happening on that front. We look at apple every week because So many people love apple stock. Let's take a look at what's happening here So apple we had the w pattern for a while. It went up It came back down and we had this channel right here So apple finally after it bounced a number of times off the 200 day moving edge, which we call the granddaddy Of the moving edges finally rallied it went from about 125 a share all the way up to 155 a nice $30 run In just a couple months peaked out all-time highs right here about 157 and a half About a week or so ago and it's come back down has lost about 10 dollars a share Where does apple lie now? Well Let's draw some some new patterns here and see what we can glean From apple if there's any pattern to see Now what we can look at now It's also all the eye of the beholder as well Some I may see something that somebody else may see a completely different pattern Now we can kind of draw maybe a little bit of an uptrending line here Um, so we've got some upward support Uh here, you know, there's really nothing There's really nothing that that uh is telling me it's going to keep falling You know, we we kind of had a I don't even want to draw it We kind of had a another uptrending Edge here, which it blew out of the the channel has come down to the Bottom of this channel now So maybe it's going to store up some energy here has fallen below the 20 day fallen below the 50 day But it's catching this upward bottom of the channel right here. Maybe it'll bounce But I can't really see uh a reason why the The stock will completely fall or drop bearishly to the 200 day moving average here, which is about 134 dollars a share Maybe it will you never know the market can be irrational Apple just came out with a new iphone 13 People should be excited about that. So maybe it'll start to Um get the stock moving up again, but for now we've got a little bit of a channel here I'm not expecting too much from apple over the next couple days Especially if the market kind of remains a little weak or or trying to find its footing apple We'll try to we'll do the same thing. It'll probably meander right along this this line here this bottom support line Which would only be a couple more dollars a share So apple pretty much i'm staying in this range right here All right, let's take a look at another stock here. Let's take a look at What do we have look at let's look at some of the biggies amazon amazon still has been in this Channel for a very long time popped above it looked like it was getting ready to go Um for more all-time new highs, but had the earnings announcement dropped a couple hundred dollars a share And so it's just trying to find its footing here after a huge move like that It wants to try to close this gap meaning over time It'll rally back up to fill this huge gaping hole here and by filling it means Over time the stock will move up to Eventually move back up to this last bar here where before the big gap happened and we're very close to that So it's almost filled that you can see the top here has almost reached the bottom here So this whole gap's almost been filled. So amazon's gonna probably meander around here a little bit And i'm sure eventually it will continue to go higher It's holding support at the 50 day moving average right here So amazon's still kind of stuck here probably will meander a little bit more But I think in the long run it'll find its footing and go back up even more Netflix Netflix looks very similar to amazon been in this long Channel here, but finally broke above it if you just extend this line here You can see it's moved above the resistance catching support right here in the the 20 day moving average so netflix actually looks stronger than compared to amazon So we may see it continue to go higher in the future Let's see what else we have What other stocks we like to take a look at oracle we've we've done some put sell plays on oracle Just this week, uh, I liked the oracle finally had its earnings just the other day So it pulled back a little which I thought was a a gift for us So we got into a put sell trade and so now it's just kind of meandering trying to Consolidate or digest the earnings announcement There's you can see there was a little gap here gap lower, but it's mostly filled that gap And see if you can blow it up a little bit more here so Uh oracle great company looking to Continue on its all-time highs in the future We like to stock sultan put options on it. Let's look at sysco Cisco has also been in a nice uptrend here You can see been in a nice uptrend and now has pulled back from all time new highs all time New highs here pulled back to the 50 day moving average So for any of you looking to get long looking to possibly time your entries A situation like this where stocks made all time new highs has pulled back to a Huge support area of the 50 day moving average could be The the trigger that will allow you to time your your bullish entries So if you're looking to possibly get long sysco A pattern like this is something you would want to look for now You could wait until it confirms the support here and starts to tick back up that way you know Okay sysco has bounced it's moving back up. You may not buy at the bottom, but you can wait for that confirmation So if you buy now it could be a false Signal and it could fall more So maybe you decide you want to wait for it to bounce and not get in at the very bottom or or nibble here Maybe buy a few shares And see what's going to happen because it could pull back more So you want possibly want to wait for the confirmation that it's going to move back up Let's see what else we have Walmart is another stock we like Has pulled back it's starting this new little downtrend channel Kind of hug hovering near the 50 day moving average. It's got the 200 day moving average not far below it if you you know Walmart's a great company The largest physical retailer on the planet if you want to get long walmart You know you watch for the pull backs and and and then if you wait for confirmation for the the next leg higher That's when you can jump in but walmart kind of looks a little ugly here But if you're in for the long haul walmart is not a bad company to consider What else disney we'd like to take a look at disney Here's a lot of different patterns. We had an up channel down channel now. We have this sideways channel It's popping above the resistance hugging or getting support at the 50 20 and 200 day moving averages that are starting to curl upwards That's something you want to see as well. You want to see the moving averages moving upwards That can confirm the uptrend. So the moving averages are an upward. You can see they're they're sloping upwards Disney bouncing off the 20 days. So disney actually looks kind of good here I like the I like the the sort of the rounded bottom here the rounded bottom Looks like disney storing up some energy to make that run to possible more all-time new highs in the near future What else do we like to see tesla? We always look at Tesla In this uptrending channel. So I did a video about two weeks ago. I wasn't here last saturday So about a week ago I guess tesla was in here kind of hugging along the 20 day moving average So it's in this little uptrending channel Tesla, you know, people love tesla and and as of now It's showing bullish signs based on this channel. So it may pull back to the bottom. It may pull back to the the Moving averages here. So tesla is in this upwards channel moving very slowly. Okay. I don't think it's going to have a massive Pull back until we wait for the next earnings announcements at next quarter earnings start sometime in You know middle of october or so so we have about a month before we start to see earnings come out But until then tesla will probably be engaged in this uptrending channel here Let's see what else also, let's take a look at some of the healthcare stocks who's those have been getting hit of late I think there's some, you know talking to us about trying to Get prescription drug prices to a minimum. So some of these healthcare stocks are probably taking a little bit of a hit because Some of their their drug prices might not be as expensive in the future. So that could affect future earnings So this is elie lily has come down Over the last few weeks still looks like it's moving lower But you can see down here at the rsi getting very close to that 25 Typical level I look for the 20 level as my support So lily coming down I want to show you bristol mires because this one is look at this just incredible quick couple week down move Getting very very oversold here. Does it mean it's going to automatically turn around and start to move higher? No, it's just telling me. Hey watch it here. This thing is getting oversold The selling may start to subside Keep a watch on it. This is a big move for being way. It's falling out of the upward channel got hit very hard But the selling could be coming to Uh an end doesn't mean it's going to pop back up all of a sudden, but we could get some consolidation down here Let's see what other Pfizer same thing all these drug companies pulling back pulling back on the rsi Um murk As well these look at this fallen out of the upward channel murk getting hit to Starting to get into that Oversold areas. So some of these pharmaceutical companies could possibly start to see the selling come to an end Probably will consolidate people realize. Hey, you know, these are still good companies. Let's start to buy it back up So start to watch at these these lower levels here for the for the pharmaceuticals um, what else we have Costco still doing well mcdonalds Still doing well was in this channel still moving up. I like the the the rounded upwards momentum here pepsi Pepsi we usually look at pepsi. Let's open this up a little bit more So if you want to draw some support, this is what you do You kind of get the bottoms And you draw the line right here So looks like pepsi is just kind of sitting on the support if it breaks through it It may drop could start moving towards the 200 day moving average here if it bounces it could go to more all-time new highs So watch this 155 level pretty closely uh 154 155 on pepsi See what happens there Uh twitter we got we we have positions on twitter Bouncing right here. Here's the 200 day moving average. This is really the line in the sand it fell below it Got its footing and starting to move back up now the 20 day and 50 day They're sloping downward So twitter's going to have a little bit of trouble here until it can really get the price action moving higher again So we want to see twitter start to move back up. We have position and we like it to be bullish So twitter needs to get on its move and start to move higher But it may have some consolidation where it's between the 200 day 20 day. So there's some some friction So twitter could possibly just kind of meander around here or it can try to break break above it So watch twitter for the next couple days or so What else we have? I don't like to look at these these meme stocks anymore chewy the pet company pet store Peloton Just kind of not doing too much. Let's look at facebook facebook is Stock that we've sold put options on has been in this nice Up trending channel actually let me pull this back a little up trending channel Falling right down to the 50 day moving average want to see this start to We want to see facebook bounce odds are it will it's still in this up trending channel Is there a reason why facebook would all of a sudden start to have a? A full on bear market probably not until the next earnings comes out So it'll probably bounce off this 50 day if you're looking to get long facebook Maybe wait for the bounce to confirm or you nibble here if you want to try to front run it But but facebook still seems to be in this up trending channel Are we getting a little long here getting close to 30 minutes? Let's wrap this up once again SPY You know coming down to the 50 day moving average, but it's bounced every other time off of it So keep an eye on it I think we've still got bull legs, you know, what's the you know, what's going to knock it down? What what's the narrative that's going to all of a sudden make all these 500 stocks have a have a bear move You know seasonal pattern. Yes, but in the long run it should keep going up I'm in bullish for the long run on a day-to-day basis anything could happen. So it depends on your time frame. All right That's all for this. Let's pull up our website real quick Our website smart option seller calm put selling basics. This is our free guide on how to sell put options That's mainly what we do. We sell put options sell put option spreads. So go to our website click on the put selling basics Put your name and email Email address here. We'll send you a free copy about put song Also, lastly our services tab click on it. Hover your mouse over We have smart option seller newsletter vertical spread trader newsletter and our one-on-one coaching Those are the services that we offer shoot me an email. Let me know what you're thinking if you want some help We can always tell you what we offer Um, I hope this video has been helpful to you. Give me a thumbs up. Leave me a comment Send me an email. I love hearing from you and I will always try to answer. All right, that's all for me today I hope everyone has a great week and weekend and a great trading week ahead. This is lee lowell signing off