 Here we go now. Hey everybody, Lee Lowell here from smartoptionseller.com. Today is Saturday, December 4th, 2021. We're back for another edition of our Saturday Synopsis. What is that? Well, these are free videos that I make and it's all about the charts. What do we do? We look at the indexes, we look at individual stocks, we look at support and resistance, we look at moving averages, we look at technical indicators. I'm here to help you try to up your technical analysis chart reading game. That's what I do, that's what I've been doing for the past 30 years to help me gauge when it's time to get in and out of a trade. I look at the charts, that's all I do. And the charts tell me everything I need to know about a specific stock or commodity or whatever. Whatever I'm looking at, the charts help me decide whether it's time to get in or out. And I'm here to try to help you, try to show you what I see in the charts as well. Maybe you'll get a couple tidbits from these videos. I'm just here to help you and make you a better trader. So let's just jump right in as we typically do. Open up the chart here. And what we like to do is we focus on the stock market and we focus on the SAP 500 first because that's the best overall gauge of the whole market. And we look at three basic indexes. We look at the S&P 500, the NASDAQ and the Dow Jones Industrial Average. Those are the three main indexes. But we typically default more to the S&P 500 because obviously that's 500 stocks. So we get a little bit more of a broader overview. And then we look at the QQQ, which is the tracking stock for the NASDAQ. But we start with the SPY, which is the Exchange Traded Fund for the SAP 500. It gives us the best overall view of the market. So we had a pretty interesting week this week and last week as well. For those of you that follow the market, you know these last two trading weeks right here, we're down weeks and pretty severe down weeks as well. And we're gonna pull up a chart of the VIX and show you why I'm saying it's such a violent week here. For those of you that are just joining us, I look at the daily charts. This is a daily chart. This is a daily bar chart. Each one of these lines is one day's worth of trading. We're not, I don't trade intraday so much. I'm not a day trader, I'm not a swing trader. And so I focus on daily charts a little bit more longer term. And the newsletters that we run, our timeframe is typically one to three months out in time. You know, for your hyperactive traders, you can always look at one minute charts. These are one minute charts coming up on the screen. Each bar is to only one minute's worth of trading. So the hyperactive traders like to look at these. We stick with the daily chart. This chart right here goes about back two years in time. So I get a good view to your view of how the market has been performing. So we like to see where the market has been and where it's been going and how the market reacts to the technical indicators that I have on the charts. Back here, pandemic, February, March, 2020 has just been going up straight since. Get peaks and valleys, peaks and valleys. We like to draw these chart patterns as we call them. See the W pattern, triangles, channels, moving averages. So these are the things that I like to look at to help me decide when a stock may be ready to jump or ready to fall. So I have three moving averages. I have a 20-day, 50-day, 200-day moving average. Here's the 20, here's the 50, here's the 200-day. I have the RSI indicator down here. This is the 14-day RSI. It's an overbought, oversold indicator. I've got the 80-level, 20-level as my overbought, oversold levels. You can tweak these, you can move these lines in or out. These horizontal lines, you can move them above, below wherever you want them. I use the 80-20 level. All right, so let's see what's happening. Let's take a look at the SPY, which is about one-tenth the size of the S&P 500 index itself, but still moves in the same direction. This past week and last week, we've had a pretty good down move, pretty sharp, rough, violent down move as well. Now, if you look at it as a whole, compared to where the market's been in the past, we've hit all-time new highs. This date was November 22nd, hit an all-time new high in the SPY 500, and now we've gone down since. Now, if you look where we are, here's where we finished yesterday, Friday, this bar right here. If you move over, it's just tagging this previous all-time new high. So the market's up, the market's been doing very well this year. Here's January 2021 back here, so the market's moved up. I think what people get scared out is when the down moves happen very quickly and violently, even though we're still practically right where we were this last all-time new high right here, but everyone was really happy here, all-time new highs, and then we went up, but when you get the pullback, people get nervous that, oh, here we go, here comes the bear market, here comes the final sell-off. Well, we'll never get another new high again. But the reason for, or the reasoning that I've been hearing and seeing and reading about why we've gone down this week is number one, we have this new Omicron variant of COVID out there. It just started like last week, very new, moving around the world very quickly already. So the scientists are trying to figure out, what's the deal with this? How much more contagious, is it more contagious than the Delta variant that came out this summer? Will it make people more sick? And will the vaccines that are already produced help with anyone that gets sick? Or can it be effective against future Omicron cases? So these are some answers that we don't have yet. I'm sure we'll get answers within the next few weeks, hoping that the vaccines that we already have will help against it. And if not, how quickly can the vaccines be tweaked to combat this new variant? So, people get nervous. We saw how violent the first down move was when COVID first came out. And then this past summer, this other variant came out. So people knee-jerk react. They sell first, they ask questions later. Along with that, we have the US Federal Reserve that came out this week that said that they will probably start pulling back on their bond buying activities, maybe sooner than they had previously said. And when they do that, when they stop buying bonds, the interest rates should start to go up. And rising interest rates is typically not favorable for the stock market. Why is that? Because people will shift their investing from the stock market into fixed income assets. So that means they have to sell stocks by bonds. So typically, you would think that stocks would sell off when interest rates go up. So that's another narrative out there. Will it end this bull market finally? No, I don't think so. Because the stock market will always go up over time. Whether interest rates rise or we have COVID out there, we have unrest around the world, the stock market will still go up because it's made to go up over time. The stock market is made up of companies, profitable companies that increase their earnings over time. And the only way to reward companies for having profitable businesses is for their stock prices to go up. You can't have a profitable business quarter after quarter after quarter and have the stock price go down. It just doesn't happen. Okay, so I'm bullish long-term for the market, long-term, years, years, years. I have long-term investing. So the stock market, I have faith in the stock market. Now, if you're a very short-term trader, then things are a little different. Okay, if you're trying to make money, intraday, same day, 24-hour hold, one-week hold, it's really hard to do because the market is very erratic in that short run. Very erratic in those short time frames. And it's really hard to pinpoint where to get in and out. And you have to be super nimble, super quick. Very hard to do. So I like to lengthen out my timeframe. In the newsletters that we run, we have our timeframes one to three months as well. Kind of gives a little bit more time to get an idea of which way the market will run. So, but for now, this is why we've had this last two weeks, this week and a half first of sell-off. Pretty rough. I mean, this is pretty sharp move. And let's take a look at the VIX real quick because that'll show you how people are reacting to that down move. Now, this is the VIX, okay? This is the VIX. The VIX is basically a fear gauge indicator slash options pricing, priciness indicator, volatility of the market. The VIX is based off the S&P 500 front month options. And it can give us an idea of how the mood of the market is. When the market gets scared, when we have these big down moves in the market, the VIX goes up. That means people are getting fearful. People are paying up for downside protection of buying put options. Okay, so here's February, March, 2020 when the pandemic first came out. VIX spiked, volatility spiked. Option prices skyrocketed. Everyone was scared. And then when things started to calm down, market starts to go back up, then the VIX comes down. Okay, but when we have these little quick down moves, you will see all these spikes in the VIX, okay? They don't usually last very long. They only last for a couple of days at a time because the market doesn't stay down, doesn't have those violent moves to the downside more than a few days at most. And then we get the bounce in the market. So the VIX gives us an idea of how quickly the market recovers from a down move. Now this is where we are right now. The last two weeks or so, a week and a half, the market's been moving down and the VIX has been spiking. Okay, so people are pretty fearful of the latest move in the market because the narrative out there, all the news items out there, Omicron, the US Federal Reserve, inflation going up, still got supply constraints. It's hard for people to buy things. So all this bad news out there, unrest around the world, whatever it is, they all come together and it scares people and that drives the market lower and it drives the VIX higher. But if history is going to repeat, this spike that we're seeing right now should not last much longer, which means the market is going to go back up, okay? So let's go back to the SAP 500. So yeah, we have this little down move that comes very quickly and hard and so it scares people. Now what I do is I follow the price action, which is which way the market goes and here is when we had the last down move. This was from September 1st to middle of October and we can draw these channels to let us know if the market is still in a certain trend. The market was in a nice uptrend, was bouncing in between the channel so you can kind of gauge if you wanted to buy when you should time your buys, when it was bouncing off the bottom edge of the channel. Now something came along, we got the sell, started a new channel, bouncing in here and it blasted out of it. So we knew a new uptrend was started. Now we have this little down move. I like to track the market to see how it interacts with the moving averages. 50-day moving average right here, this is the 50-day, is a very widely followed, very important indicator for the market. So we like to follow that. A lot of people follow the 50-day moving average. What I like here is that yesterday, the long bar here finished right around the 50-day moving average. Typically on each one of these bars, there's a little dash on the right side of the bar that tells us where it closed for the day. Now let me see where this, yesterday's closed, December 3rd, goes right around $453.30, which is exactly where the 50-day moving averages. So the market closed, the S&P 500 SPY goes right on where the 50-day moving averages. So that's a good sign. We like to see support coming in here. For those of us who are bullish, have bullish oriented positions, we wanna see the market go back up and we wanna see it bounce off one of these moving averages. And so the market closed right on the 50-day yesterday. So that's a good sign. What I wanted to show you is that if you track the E-mini futures, the E-mini S&P 500, E-mini NASDAQ futures, here's the E-mini S&P 500 futures, which trade almost 24 hours a day during the week, also closed right around the 50-day moving average. So hopefully we'll get the bounce. Let's look at the NASDAQ, the E-mini NASDAQ futures, also close or bounce right on the 50-day moving average yesterday. That's a good sign. You can see it a little more clearly here. Here's a little dash mark. Right here, you can see that's where the NASDAQ futures closed yesterday. So above the 50-day moving average, that's a good thing. QQQ, which tracks the NASDAQ. Also, you can see the channel that we've drawn. So it hit the top leg, so it's starting to come down. But yesterday, right here is the 50-day. Also bounced off the 50-day. Here's where the closes. You can see a little dash mark right there. Let me open it up more. Here's a little dash mark. So I'm hopeful, and I like that all the indexes, SAP500, NASDAQ, QQQ, SPY, all bounced or all finding support right on this 50-day moving average. That's a good sign. Hopefully for next week, people won't be as scared. News out this weekend won't be so bad. And we can get that bounce come Monday and next week. Move us back towards the high. So this is the QQQ. Let me move this over here. So it's been in this nice uptrending channel. So the price action is bullish. The price action is upwards. That's what we'd like to see. And it's been contained in the channel. These are the things, these are the patterns that you can draw to help you gauge where you think the market might move next. So I like that it's found support right at the 50-day moving average. Let's see if we get that bounce next week. Always a chance that it could keep coming off, but we'd hope that the bottom leg here would find to give it more support and at a minimum, the 200-day moving average right here. Everything's still sloping upwards, moving average is sloping upwards. That's good. Let's go back to the S&P 500. Once again, finding support right at the 50-day moving average. The RSI, right around 42.67. So that's right in the middle. So we're not really overbought, not really oversold. Just kind of moving along. So that's good. There's no warnings down here for anything. So let's see if the market could get itself going next week and start to bounce here. Get moving up to more all-time new highs. December usually pretty bullish. So let's see what happens next week. We can look at the Dow. We can look at the Diamonds, the DIA. That's the exchange-straighted fund for the Dow Jones. I don't put as much emphasis on the Dow because it's only 30 stocks in that index. But you can see here, here's the 200-day moving average. So the Dow Jones finding support at the 200-day moving average. We really don't wanna see it drop much below the 200-day moving average for more than a few days at a time. And here's the close, little dash mark. So we closed above the 200-day moving average. So I'm hopeful next week we'll get the bounce. If not, then we have to endure more selling. But that just means better opportunities to buy for the long-term. That's what I do. I buy in dips, hold for the long-term. Okay, let's take a look at some individual stocks and also watch the VIX next week. See if the VIX starts to come down from those spikes. Let's look at individual stocks. We tend to focus on some more of the popular stocks here. So we look at Apple. You always look at Apple. Apple had an all-time new high this week. You know, if you follow the market, you may have seen there's a lot of stocks that went up and a lot of stocks that went down. Just, it seemed very random this week. Tech stocks got hit a little bit more or some tech stocks, not all. Apple being, I guess, somewhat of a tech stock, although it's been around for a long time, you know, hit all-time new highs this week. Sort of bucked the downtrend of the overall market and went up. So Apple got just above 170 this week per share. Good thing. Apple, you know, has this nice kind of rounded, rounded bottom here and then just started move up. Was hugging along the 20-day moving average. Made all-time new highs. So Apple looks strong now. I mean, it has been going up, but going up, up and down in fits and starts. And maybe this'll probably, or maybe this'll be the nice start of the smoother ride upwards. And hopefully Apple can keep making all-time new highs here. We have a put spread that we've sold on Apple that's working for us. Put spread is more of a, selling a put spread is more of a bullish type of trade. So we like that trade on Apple. So Apple, I like Apple. I like the chart pattern, I like the way it looks. Should be strong moving forward, especially if the rest of the indexes start to move up as well. Tesla, also a favorite to watch. We drew this triangle congestion pattern last week, which typically means the price actions getting in a tight range, coiling up a lot of energy ready to blast off in one direction or the other outside of the triangle. Just yesterday, Friday, it showed its hand and it dropped down and out below the triangle. Closed just above, close around 1,014 yesterday. There does seem to be possible support right around the $1,000 mark. You can draw a trend line here. You can draw these lines and see if the support will hold this week or in the incoming weeks. Seems to be some support there. If not, you've got the 50-day moving average lurking right below, so maybe it'll find support here at the edge of the 50-day moving average if it keeps falling below the $1,000 mark. And then below that, maybe it'll come back into this channel that it was in for a while. That would take it below $900 a share. That would be a pretty sharp move, but you never know. You never know how these things play out. Tesla is just crazy stock to follow. So be careful if you're playing it. But for me, it broke out to the downside here. Hopefully it'll find some support at $1,000 for those of you that may be long and see if Tesla starts to go back up again. But there's possibilities for a little more downside, maybe. What other stocks we'd like to take a look at, Amazon? Look at some of these biggies. Amazon's still in this long channel. Had it pop out here, couldn't sustain it, came back in. Here's an earnings air pocket in the channel, popped out again very recently, but has come back in and is now support right on the 200-day moving average right here, bounce right off the 200-day. So Amazon's just still kinda hanging around this wide range. Can't get its mojo out and through, up through the channel. Now this is what is maybe a double top pattern here. Double top pattern is pretty bearish sometimes. Nothing's guaranteed, but it made the double top which you can see got knocked back down. So a double top pattern could lead to selling. And so maybe Amazon will find support here and start its next leg higher. But overall, it's just stuck in this channel. Not, if you've been bullish and you've been holding and then it gets knocked back down, it's been very frustrating, I understand that. So we wanna look for stocks that have that momentum that's showing us that it's continually going up and then where it bounces, we can get long. This one is just too much of a sideways pattern to really gauge a higher or lower move. Now if you're selling things like strangles or iron condors, you've been doing pretty well with Amazon. What is that? It's when you sell a call spread and you sell a put spread at the same time, outside of the ranges, hoping that everything expires worthless and you collect your cash. So but if you're doing those, be careful because Amazon could really get moving pretty quickly. Let's look at Microsoft. Microsoft's been very strong, has nice upwards, price action, was in the channel for a while and has kept moving higher. This yesterday, you can see had a big move down here. I was down about six dollars, six and a half dollars. But here's the 50 day moving average, almost tagged it. So it'll probably find some support here. Microsoft's in an uptrend. So if you're looking to be bullish, you wanna wait for some pullbacks before nibbling or getting long. A bounce here on the 50 day would be nice to see, especially if the indexes, everything starts to move up next week. If everything moves up next week, it'll find support right here and start to go higher again. So what am I seeing here? Other than this channel, at this point, Microsoft just is looking for support at the 50 day moving average, RSI not oversold. So I think the price action should continue to move higher once it finds support here. Let's see what other stocks we can look at. So Intel still on the down, Nike hanging around, might find some support. Oracle, let's look at Oracle real quick. We had a put sell on Oracle, which we took profits on recently. You can see Oracle was in the channel, has fallen out of the channel now. Have you got the 200 day moving average lurking below? I think Oracle has earnings coming up relatively soon in the next couple of weeks. So I'm waiting to get into another position on Oracle, but I have to wait for earnings first. I'm not gonna get in before an earnings announcement. Sort of moving down on the RSI. So maybe if it falls a little more, maybe towards a 200 day moving average, maybe get a little oversold here, then that's where you start to think, okay, maybe we've hit a bottom, maybe I could start nibbling. But remember, you got earnings coming up at some point in the next few weeks. So you wanna be wary of that, okay? But I'm waiting for my opportunity to get into Oracle. Let's take a look at Disney because we talked about Disney recently. Disney has just gotten torpedo to the downside, got way oversold. We got into a position this week on Disney. We sold a put spread out of the money put spread as I feel that this could be a bottoming action. Sometimes trying to pick bottoms is not the best thing to do because the stock could always keep moving lower. But based on the RSI here, got way oversold. So we took a stab and we sold some put spreads on it. I mean, Disney's a great company. So I don't feel like we've stepped into something really bad here. Disney will turn it around, the stock will turn around. Quality company getting hit that hard, it's just too hard to ignore on the downside. Way oversold, so we stepped in. Now, I bring this up each week, here's Verizon. Now trying to pick bottoms on certain stocks is not always a good thing because if the chart's not telling you that it's oversold yet, then you don't wanna try to pick a bottom. Verizon still going down, was in the channel, created a new channel all time, ahead another low here, got just under 50. But the RSI has not gotten oversold yet. It didn't have that wash out, fully oversold move yet. So this is just a slow creep lower. Okay, there's a difference between the slow creep lower, like Verizon versus the whoosh down move, clears everybody out type of move like Disney. Okay, so I'd be more comfortable trying to pick a bottom on Disney versus trying to pick a bottom on something like Verizon, which is just like the slow drip lower. I don't like that, okay. So let's take a look at some other stocks. AMD, which is one of the chip stocks that I love, I talk about it all the time, had just gotten a little bit too overbought for my liking. I like the pullback here, not sure if I'm ready to jump in yet. RSI has come back right down to the 50 low. So that's good thing. I'd like to maybe see AMD pullback a little bit more possibly to the 50 day moving edge. I don't know if it'll get there. I'm waiting for another opportunity to get into AMD, but it's hard for me to gauge whether to jump in here or wait a little bit more to see if it pulls back to the 50 day moving average. But AMD still quality company. Netflix got hit pretty hard this week. We have a put spread on Netflix that we sold. That's more of a bullish play. So this was not a great move for us. It was in a nice uptrending channel. We had gotten in back here when it bounced off the bottom leg of the channel went up just like we thought. But now it got caught up in the really big down move the last week or so. I don't like to see that. So I'm hoping here the RSI start to move down could be a little more downside, but I'm hoping it's gonna catch a bid here and start to move up. So Netflix, I'm not so happy about that price action. Cisco, I'm not much there. Let's talk about Walmart. I love Walmart. Talk about Walmart. Had a pretty nasty week. You got support right around the 135 level. So if you're looking to possibly get long Walmart, maybe you nibble a little bit. Nibble meaning buying maybe a couple of shares just to see, know nothing wrong with that. If you wanna try to take a stab, we know Walmart quality, quality company. It's got some support here. So maybe it'll find the support and then bounce again. Walmart for the longterm. I don't think you can go wrong. You know, if you're gonna buy and hold, if you're trying to day trade this thing, trying to swing trade, it's a little more difficult. But if you're holding for the longterm, right now the 135 level seems to be some support. So keep an eye on Walmart and see what else we got. Talked about Disney, talked about Tesla. Now the pharma stocks have been up and down. Eli Lilly, Bristol Myers really got nailed, hit oversold here. But you can see the price action kept moving down, but the RSI was moving up, that's divergence. You got price action moving down, RSI moving higher, that's divergence. So the price action did go back up, but this last two weeks or so got nailed again, but found a little bit. So the pharma stocks are a little confusing. You know, healthcare is paramount to almost every citizen on this earth. So I'm both on the healthcare sector longterm, but I don't like how things have been getting hit. We've got a position in Merck as well. Merck's just been all over the place. And I'm hoping that we'll find support here with Merck. We've sold a put option, you know, still out of the money. Got a little bit of cushion left, but I'd like to see Merck get on its horse here and start to ride higher again. Kellogg talked about Verizon. Oh, PayPal's another one. PayPal, I love the payment sector, PayPal and Square, but they've been getting hit pretty hard. Here's PayPal just coming down our size, coming down to some oversold levels here. Will it find a bottom? It's possible you got the price action moving down, but yet the RSI is staying flat, not making new lows, which tends, makes me believe the selling could be coming to an end here because the RSI is not making any more new lows. So the sellers could be starting to dry up here, maybe find some support and start to move higher. I'm gonna be watching PayPal to see if we've got a bottom here. Let's look at Square. Square does the same thing, payment sector. Square just cascading lower. RSI getting to some oversold levels, but I don't think the price action is bottoming out yet because I'd like to see the RSI start to move sideways here as well. So Square could be some more downside versus PayPal might be finding a bottom here. What else we got? Costco still strong, hadn't pulled back. Maybe this is the entry point for some people. Pullback still very expensive stock. McDonald's looks on the chart just kind of decent. Just kind of slowly moving up, finding support at the 50 day and 20 day moving averages, which is a good thing. So McDonald's looks pretty good here. Pepsi, which I follow. Also kind of same thing, just kind of moving up, finding support at the moving averages, had a good day yesterday, was up over $4 a share yesterday. So Pepsi looks like it wants to keep going higher. You know, follow the moving averages, look for the bounces, look where it is on the RSI. You know, this is how I do it. All day long, I'm just going through charts. Now for those of you Twitter, Twitter also getting hit pretty good. Now let's take a quick look at Twitter. Look where it is. It's below my level 20. It's at 17 and change. That's very oversold. But does that mean the bottom has been found yet? I don't know. Twitter, I like to see some sideways action first and then see what the RSI does. But Twitter's definitely getting oversold. Definitely got hit pretty hard. Picking bottom here. Maybe nibble a little, but I don't think we have, but the bottoming action hasn't started yet. It has to digest this move and start to trade sideways. That's not happening yet. Keep an eye on Twitter. It will bounce at some point, but I don't think it's there yet, but getting close. For those of you following Bitcoin and all, Bitcoin's had a big move down. It went from high of 68, 69,000 not that long ago. Had been trading around 56, 57,000 and then Bitcoin dropped overnight to about 46,000. 46, 47,000 big drop. Mara, Marathon holdings and Riot. I've been, Riot's pretty flat, but Mara been getting hit a little bit to the downside for you Bitcoin followers. Come Monday, if Bitcoin itself is still lower, Mara's probably gonna open up pretty close or even below the 200 day moving average here. So keep an eye on that. All right, I think that's about all we have here for the markets. Keep an eye on the news out there. Keep an eye on the indexes. Watch those moving averages wait for the bounce if you wanted to get long, follow the patterns. That's what I do. Obviously nothing's guaranteed. Nothing works 100%, but these are more higher probability trades. All you can do is look for the higher probability trades. That'll help you increase your account value over time instead of just blindly taking a stab at buying or selling a stock. You wanna watch the moving averages, watch the price actions. These things work because millions of people follow these things. And everyone who knows how to do technical analysis and trading, we all kind of follow the same things. So we all kind of get in and out along the same lines because everyone's watching the same thing and everyone has an idea of where things should bounce and where things should sell off. So it does sort of become a self-fulfilling prophecy. And it works. Been doing this a long time. So that's about it. I'm hoping we'll get some bullish action next week. All right, let's take end this thing here. Let's do what we always do. Our website here, smartoptionseller.com. We sell put options. We sell put options spreads. We have two newsletters, but if you wanna understand what put selling is all about, go to this page, click on put selling basics. Put your name, email address. We'll send you a free copy of our report. Over here, our services tab. We have the two newsletters and we have our coaching. For those of you that trying to get to the next level need a little help. We have our coaching that our students seem to like very much. All right, this YouTube video, if it has been good for you, if it has been helpful, please give me a thumbs up. Leave me a comment. I answer the comments. You can also email me. I try to email back everybody that sends me a message and that's about it for today. Don't forget to subscribe. Hit that red subscribe button in the bottom right hand corner of the video. All right, that's all for me today. I hope everyone has a great weekend and a great trading week ahead. Hopefully I'll see you back here next Saturday. This is Lee Low signing off.