 All right, everybody. Good morning. Lee Lowell here, smartoptionseller.com today is Saturday, May 15, 2021. I'm back. Yes, it took last weekend off, Mother's Day weekend, took a little break, gave you guys a break, let all the information that I've been sending you, showing you, let that sink in for a little bit. But today, we will be talking about, as you can see on your screen right here, I always get the same questions people email me whenever we have a decent-sized pullback in the market. If you consider this a decent-sized pullback, I always get the questions. Lee, what do I do during a pullback? How do I protect my stock and option positions when the market pulls back? I get scared. I sell out. I lose money. And then the market comes ripping back higher. And I don't like to get whipsawed like that. So what can I do? How do I protect a position and maybe not lose a lot of money or just not do anything? So what can I do? So I'm going to give you some ideas on how to protect yourself, what you can or cannot do, or what you should or shouldn't do during a pullback. And just give you some ideas of how to become a better trader. That's what we're here to do. So that's part of our Saturday synopsis where I give you some great options information, free options information. And we also do our synopsis of the charts. That's what I call my Saturday synopsis. I look at stock charts. We look at indexes. I give you an idea of what I'm seeing on the charts because to me, that's really the cornerstone of becoming a better trader, whether you're trading stocks or option. You need to know what the stock is going to do or possibly going to do to give yourself a good, a higher probability reason to get into the trade. And for me, that's all about looking at the stock charts. So we look at the charts, see what's going on. I show you some patterns. I give you some insight into where I think a stock or index may be headed in the future and we go from there. So let's jump right in and talk about what to do when the stock market enters into a pullback. Now, most of us are typically long or bullish because over time, that's just which way the market goes. It goes up. So we tend to have more bullish positions than bearish positions. But there, yes, will be times when the market pulls back, whether that's a small pullback or a large pullback, there will be times when the market does pull back and people get scared out of their positions, especially if they bought, you know, right near the top of the most recent move and the market pulls back, they get scared. They don't know what to do. Maybe they haven't been investing for a long enough period of time. So it scares them out. And then on TV, you hear about, okay, well, this is the end of the bull run. Here comes the next bear market and then people get scared out and they try to put on bearish positions and then the market flips right back up and goes higher again. And you get whipsawed out. So investing is not easy. You know, trading is not easy. It's a lifelong process. It's a skill that you have to learn over time. You can't do it overnight. I've been doing this for 30 years and I'm still learning stuff. I'm learning how to tweak my methods and how to get better. It's a lifelong process. So if you're just starting out, don't get overwhelmed. Don't get scared out. Just stay small and learn as much as you can. And I'm here to help you on that path. So we've had a pretty good pullback in the market the last two weeks or so, especially in the Nasdaq, mostly in the Nasdaq. These are the tech stocks. And the reason why we've been seeing those pullbacks is because we're getting news out of the general financial world about possible rising interest rates from the US Federal Reserve and inflation. Prices are starting to tick up in all walks of life, whether that's real estate or groceries at the store or just cars anything that you buy, we're starting to see some inflation creep in. And whenever inflation heats up, and that is a signal that interest rates may start to rise at some point in time. And interest rates rising is usually a detriment to the stock market because now maybe you have fixed income securities that will pay more and that'll be in competition to stocks. So people might sell their stocks and buy into bonds or CDs, just fixed income securities. The other reason why interest rates are detrimental for stocks, especially growth tech stocks is because now money is more expensive to borrow. So if a company has to spend more of their money borrowing, that means there's going to be less in their profits, more costs, smaller profits. So that may hit the stock prices as well. So you get these two things, inflation and interest rates that kind of scare people for a while. But we know in the long run, the market is going to go up no matter what. And you've seen it in the charts, and I'll show you in the charts over the long run, decades, stock prices go up over time. And that's during rising interest rates, rising inflation, we have wars, pandemics, everything that you can throw at the stock market, eventually it will overcome it and start to move back higher. But yet we have these these pullbacks here and there, whether they're short pullbacks, deep pullbacks, small pullbacks, whatever, people get scared or they want to know what they should do during those times of a pullback. So what I have here on the screen is just some ideas that we can discuss to help you become a better trader in what you can do during these times. Now, number one, sometimes taking no action is the best action. As you've seen, if you watch the stock market, you watch charts, most of the time stocks end up going back higher. You just have to wait it out. But it all comes down to, do you have the, you know, the intestinal fortitude to wait out positions? Because maybe you bought a lot of stock up here on the top, and you have to make profits to pay for things that are immediate, like your mortgage or your rent or your car payment, whatever. If you're trading in the market to pay for immediate bills like that, that is a very hard gig to do because you're going to be part of these swings in the market, these pullbacks that could really give your position a short-term hit, which may force you out of position. And then you're in a deeper hole than you were before. So it comes down to the number one here, number two, there is no one size fits all solution because I can't offer a solution to everyone out there because everyone's situation is different. Maybe you're a long-term trader where you're looking out 20 years where these little pullbacks mean nothing. Or if you're a very short-term trader, like a day trader or swing trader where you have to make money to pay for bills, that's a tough gig. So you can get scared out of positions very quickly if you're trading very short-term. The market is super erratic in the short-term, super erratic. The long-term you can see, you know, the real trajectory of the market. So are you a long-term trader or short-term trader? Are you doing this because you're setting goals for retirement? Are you doing this to pay your bills? Because either way, you're going to have different solutions to your problems. Right? So you need to know, are you a long-term trader or short-term trader? And one solution may not be good for the other person. So a couple of things here is that if you're a long stock and you've held stock for a while, you know, what can you do to protect your position, your stock position in a down low? Well, the Wall Street consensus is, and the long-term advice is, set a stop loss on a position. Set a stop loss. Now what is a stop loss? A stop loss is that an automatic out that you put in with your broker. So if you bought a stock here and you want to protect yourself for the stock falling down to here, you put in a stop loss order, meaning you will sell out of your position if the stock drops a certain amount. What is that certain amount? Well, that is up to you to decide. If you bought a stock at 100, how much are you willing to lose? 10%, 20%, 30%, it's completely up to you. You have to decide ahead of time. And you should always make the decision ahead of time, because once the market starts going crazy and you're in the midst of all that angst and emotional craziness, you can tend to make bad decisions. If you set the automatic stop right when you get into the trade, it's automatic, you'll get knocked out, and you move on. You know, even though taking a loss is not a fun thing to do, it could always turn into a bigger loss if you don't get out soon. So the biggest piece of advice that the consensus is set stop losses on a long stock position. And you have to decide how much you're willing to lose. Now, if you're a long-term trader, I'm talking a 10-year horizon, a 10-20% move maybe won't even phase you. It's just part of the market. And over time, that 10-20% loss will get turned around and go back up higher again. So you can wait it out. If you're a longer-term trader, you can wait it out. If you're a short-term trader, like I said, a day trader, you need the money quickly, then you have to set your stops pretty tight. Maybe a 1% or 2% stop, because you don't want the loss to get big. So maybe a 1% stop loss is good enough if you're a day trader. Once again, it all depends on what your timeframe is and how active you are. So setting stop losses, whether it's a 1% stop loss, a 10% stop loss is up to you to decide. Now, your stop losses can be moved along with time. It's called a trailing stop loss. Okay, so as your stock moves up, you move that stop loss up along with it. And I think most brokers have an automatic way to do that. If you want to set a 10% stop loss on your stock position and the stock keeps moving up over time, well, your 10% stop loss keeps moving up as well. And that is what's called a trailing stop loss. So as the stock moves up, your sell point will move up as well. So your profits, your eventual profits can get larger and larger. If you bought the stock at 100 and you set a 10% stop loss, originally, you'd be sold out if the stock dropped to $90. That's a 10% move. Well, if the stock moves up to $110, now your 10% stop loss is roughly $11. So now you'd be selling it out at $99 a share. Okay, it's better than your $90 a share original stop loss. And if the stock moves up to $200, you know, now your stop loss is a $20, you know, 10% is $20 low. So that's at $180. So you move your stop loss up as the stock goes higher. That's a trailing stop loss. So setting stop losses is an easy and simple way to take care of a position, a stock bullish position when the market pulls back. Now, what do you do if you have an option position? If you've bought options, if you bought calls or bought puts, whatever, how do you can you set stop losses on option positions, option positions? And yes, you can certainly do that. Now, there's there's a distinction of do you do you still watch the stock price? If you if you have the option position only, do you want to set the stop loss based on where the stock drops to? Or do you want to set the stop loss based on where the option price moves to? So it's, I'm kind of torn between that, right? The stock is really the main indicator of where, you know, how you should set your stop loss, whether it's a stock position or option position, because options can be somewhat illiquid at times, the bid ask prices on the option can be quite wide sometimes. So if you you can get prematurely stopped out of an option position, regardless of if the stock moves to a certain level. And so my, you know, I pretty much default to I like to see where the stock moves first, because that's my gauge of how I feel about a position. Now, if the stock moves beyond a level where I'm comfortable with, then I would get out of the option position. But some people like to set stop losses on the option price itself, regardless of where the stock goes. And, you know, the option price is going to move not only based on where the stock goes, but also on volatility levels, how much time is left to expiration. So you can really get taken out of an option position prematurely without the stock really breaching any levels that you've set. So it's sort of a trade off. Do I want to set a stop law if I only have an option position, if I bought a call or I bought a put, do I want to set a stop loss based on where the option price moves to or where the stock moves to and that's that's a tough one. Okay, that's a tough one. I would default to where the stock goes, because if the stock doesn't breach the the stop loss, I'm still going to hold but but the option price may have breached its stop loss regardless. So you have to decide where do you want to set your stop loss on the option price itself or the stock price. I default more to the stock price. But, you know, sometimes watching the option price, you know, if it's a very liquid stock, like something like Apple, where the option prices are very tight, you know, the bid ask bid ask prices on options are, you know, one or two cents wide, you know, then you could probably set the stop loss on the option. But if the option bid ask prices are like 50 cents wide, then it's probably more important to to set the stop loss based on where the stock is trading. So that's very important to understand setting the stop loss on the option price or setting the stop loss on the stock price. Okay. So what's what's another thing we can do to protect up a bullish position in a pullback? Another thing we can do, like I was saying, is looking at the cheat sheet here is that you can sell covered calls on a long stock position, right? For every 100 shares of stock you own, you can sell one call option against that position. What does that do? Well, the call option can offer you some downside buffer. If you sell a call option, you're going to take in some cash, right? So that cash can act as a buffer against somewhat of a move downwards in the stock. It won't completely protect you, but it can protect you for maybe a couple of dollars that the stock might move down. So selling covered calls is a way to buffer some of that downside. But but just know that if you do sell covered calls and the stock goes up, your your stock could get called away from you. So that's just something to consider when you use selling covered calls as a buffer against the downside movement. Another thing that we do often, well, not often, but another thing you can do and something that we do here at the smart option seller is you can roll your put options. When we sell put options here at the smart option seller, we sell naked put options. And sometimes when the stock goes down, that put option position can become in jeopardy a little bit, meaning that the stock might come down to the strike price. So, you know, if we don't feel comfortable in that position anymore, we can roll our naked put to another naked put. And I'll show you that how you how you can do that in a second. But what does that mean? Well, if we sold a put option, we don't want the stock price to drop. We want the stock price to actually stay flat or move up. But in a pullback, when all stocks move lower, the put option that we've sold can become, you know, closer to the possible assignment of those shares of stock. Is that okay with us? Sure, it's okay. But we'd rather get in an even cheaper level. So we will roll the put option. What does that mean? Well, if you sold a naked put, that means you have to buy back that original put option. Now you can sell a new put option for a farther out expiration date and a lower strike price. So let me show you what that means here. Because we've talked about rolling before. And let me pull up the option chain here at Interactive Brokers. So we've got Apple up on the board here, Apple options. And here's the puts on this side. So let's just take a quick look. So let's just say, you know, here's Apple current price $127 and change. Let's just say it's June, our June expiration 34 days before expiration. Let's say we were short a 115 strike put option, which is currently worth about $0.90 per contract. Let's just say, you know what, we want some more downside buffer. You know, even though there's still a good $12 plus difference between Apple's current price and the strike price, that's about, you know, $12 and change difference, that's still $12 a buffer. Here's what we would do. It's worth about $0.90. So if you want to give yourself some more buffer because stocks are dropping, what you would do is let's say you'd buy this put option back at $0.90 per contract. Now you have to go out on the expiration scale and sell a new lower strike put at roughly the same price. So what you do is you manually, you have to look through the expiration here. Let's go out to August. So we want to find a new lower strike put option that's worth roughly $0.90 as well. So let's just say we go out to August, which is two months into the future from your June position. And you look for a lower strike put that's worth at least $0.90 a contract. So here you can see, now the 100 strike put is worth about $1.02 per contract. That actually could meet our requirements. So what we would do is we would buy back the $1.15 strike put, and now we would sell this new August $1.00 put for over a dollar, about $1.02 per contract. So you're actually going to do better. Okay, you bought it back for $0.90, but you're selling a new one for $1.02. So you're taking in even more money and you've just lowered your strike price by $15 per share. You went from the $1.15 strike, now you're down to the $100 strike. So you've actually just increased your downside by another almost $28 of cushion. So that's what you can do. That's what's called rolling a trade, a rolling a put option if you get into trouble. So that's something you can do when stocks move lower. So rolling your naked puts can help you increase your downside buffer. The only thing is that you're just lengthening out the trade now, in this case, two months. So that's something you can do if you have a short naked put option. The other thing is that if you have a long stock position or just a long general exposure to the whole market, you can buy long-term or short-term put options right here at number seven. This is the great insurance hedge. Buying put options protects you against a down move because if you're a buyer of a put option, that value of the put option will go up in price. So as your stock positions go down in price, your put option position goes up in price. So one thing's sort of offsetting the other. But buying put options is just like buying insurance. Most of the time, you'll never have to use the insurance. So you're paying for that insurance, you're paying for the protection. You can buy one month options every month at a time, or you can buy a six-month option or a 12-month put option to get long-term exposure. It depends on what you're thinking is. Now, if you never have to use the insurance, most likely that means that the stock prices are still going up, which is good. So hopefully your long stock position will gain on the long stock position will offset the money that you had to pay out for the insurance. So that's something that you have to decide. Do you want to protect your position all the time or just during times where you think the market might get a little crazy? So you can decide. If you're feeling like things might be selling off, maybe you buy a one-month put option, an S&P 500 put option, that could be just protect you in the general overall market. Or you can just buy a put option on a specific stock position that you have. So it's up to you to decide. And you can decide whether you want to take a long-term approach or short-term approach. And lastly, the way to protect yourself in a pullback is buying deep in the money call options instead of buying stock. Now, this is something I talk about all the time. It's the only option buying strategy that I recommend in all usage in bullish markets is to buy deep in the money call options instead of buying shares of stock. And why would we want to do that? Because number one, you have to put out a lot less money buying call options than you would if you bought stock. And as if the stock price starts to drop, you're deep in the money call option will lose money at a slower rate over time than a stock position would. And you're not really exposed so much to the time decay and changes in volatility when you buy a very deep in the money call option. Because it's almost like buying the stock itself. And stocks, of course, aren't their prices affected by volatility and time decay that options are. So deep in the money call options give you all that kind of benefits against buying the stock itself. So if you want to buy shares of stock, I would suggest, or I teach people, buy deep in the money call options instead. And when the market has a pullback, it won't be as detrimental as if you just own shares of stock. So those are the things that I can suggest. And remember, this is not actual individual advice. This is just education and information that I'm providing you. So no, no real investment advice, no real individual recommendations here. So these are some of the things that I can offer as a way to protect during a pullback. And once again, like I said, as we see the market always goes up over time, maybe doing nothing is the best thing. Maybe doing nothing is the best thing. But if you really have a position that you're scared about, you can always choose to look at some of these ideas. Okay, setting stop losses, using covered calls, rolling out your naked puts, buying in a long term or short term put options, and buying deep in the money call up. So those are just some ideas. Everyone has a different risk threshold. Everyone's positions are different. Everyone's a different type of trader long term short term. So no one size fits all right here. Number one, there is no one size fits all solution. It all depends on your situation. Okay, so that's it for our little lesson on what to do during a pullback. I hope this is somewhat helpful to you all. Let's move into our Saturday synopsis of the video here. What is that? Well, we like to take a look at the charts, see what's happened over the last week or two, and get a gauge of what may happen moving forward. We'll look at the indexes with some individual charts. And so let's jump right in. We always open up to our S&P 500, as represented by the SPY, which is the exchange traded fund for the S&P 500. Now, if you've been watching my videos for a while, you know, we've been bullish since the end of the pandemic at the stock stock market end of the pandemic here last March 2020. It's just been nothing but up, nothing but up. You've got a nice clear uptrend showing in the broader market. And then during those times, during that uptrend, of course, we have pullbacks along the way, you can see pullbacks moves up pullbacks move up. But when you get most trending stocks, whether that's an uptrend or down trending stocks, they will typically bounce off the moving average lines. Now, moving average lines are a little bit lagging, because you have to take old information and put it into the new information. That's how moving averages work. They, they take all the prior days and averages out into one smooth line. Now I have my blue 20 day moving average, I have the 50 day moving average and the 200 day moving average. Those are very popular moving average lines that a majority of technical traders will follow the technical meaning their stock, their chart watchers. And down here is my RSI 14 day RSI indicator, which is their overbought, oversold indicator. Now, in the S&P 500, and I'll show you it in the other indexes, this past week, we had somewhat of a pretty decent down move, mostly in the tech stocks. But what you can see, and I always say is that typically on a pullback, the market or the stock will bounce typically either off the 20 day or 50 days. As long as it's still in a good uptrend, one of these moving average lines will catch the bottom and it will catch the bounce. So what we can see here is this is a bar chart, daily bar chart. Every bar is one day's worth of trading. And you can see right here. So Friday, Thursday, so Wednesday of this week, Wednesday, you can see how the S&P 500 bounce right off the 50 day moving average, you can see right here. I mean, the bounce was like practically perfect bounce right the bottom of that day, each bar right here, you can see it bounce right right on Q. Okay. And look where we ended up Friday, right here, actually ended above the 20 day moving average. You can see on the bar, there's a little dash mark on the right side of the bar, which tells us where the market closed for the day and it closed above the 20 day moving average. So that's a very good sign. We had a couple days of good selling, it scares a lot of people out, they think this is it, this is the next big bear market, it's happening. And then out of nowhere, it will just bounce. And it bounced right off the 50 day moving average. So if it goes down through the 20 day, you know the 50 day is the next line of support. If it gets down to the 200 day, that's a pretty significant move. We really don't want to see it go down that far. But if it does occur, the next line of support would be the 50 day, I mean, the 200 day moving average. So you've got this nice uptrend, you've got the pullback. So if you haven't been involved in the market and you've just been waiting for, when do I get in? When do I get in that bullish position? I always say, watch for the bounce off of the 50 day moving average at least. If the market's coming off, you can either try to front run it and nibble a little bit, you can buy a little bit here just to see if it's going to bounce. And then if it bounces, you know that, okay, there's some good buying coming in, maybe I can buy a little bit bigger position at this time. So you want to see the bounce. So I like the market. I've been bullish. There's really no other place to put your money to get any kind of return on your money. And here in the US, the vaccine's rolling out good. People are getting vaccinated. I keep saying this, businesses are opening up again. They're creating more products, restaurants are opening up, bars are opening up, other establishments are opening up. People have money to spend. And when people spend money, that means they buy products. That means earnings for companies go up. That means stock prices will go up. It's just that's how the stock market works. Yes, we may have rising inflation and rising interest rates. But just know where interest rates have been interest rates are just so super cheap. Even if rates go up a little, how much of a detriment could that be? The market will factor that in. The market goes up over time. Let me pull up the long term monthly chart. Here's the financial meltdown in 2008, 2009. The market's just gone straight up since then, the last 13 years, practically, almost 13 years. And that's through good times and bad times. Yes, we'll have pullbacks. But the pandemic was a major pullback here. But it only lasted maybe a month or two before it really started to go up strongly again. The market goes up in all scenarios. So you have to have some patience. You have to be secure in your decision when you're buying into a stock or an index. The index will go up over time. You can have a nice passive position of investing in the S&P 500. It goes up over time. The RSI right here in the middle, in the 50s, that means it's not overbought. It's not oversold. It's just doing what it should be doing, has a nice slow up trend. So if you've been waiting for a chance to get in, you look for the pullbacks to the moving average line. So let's take a look at the NASDAQ because that one got hit pretty hard. And let's look at the QQQs because that's a good barometer for the NASDAQ. Now, as I mentioned earlier in the video, tech stocks will get hit harder because these are the go-go stocks, the growth stocks, they have a lot of hype behind them. So when there's news out there that stocks could sell off, the tech stocks get hit the hardest. So we've had like two weeks worth of down move, whereas the S&P 500 and the Dow industrials didn't get hit as hard because they don't have as many growth stocks in those indexes. So the NASDAQ gets hit pretty hard. So we had this little down move here and obviously, here's the price action, the bars of the price action went below the 20-day and it's gone below the 50-day. But look where we finished yesterday, Friday, May 14th, finished just on the 50-day moving average. It's very constructive close, just basically right on the 50-day moving average. So that's a good sign. I typically like to give a market, you know, the three-day, my three-day rule is if it closes below the 50-day moving average more than three times, you know, then you really have to be possibly concerned. But look how it bounced back right up to the 50-day. So I'm hoping next week we can maybe consolidate here a little bit or start to move back up. What is what is holding things back? What is holding things back? Where else are you going to get a return on your money? And the big money institutions, fund managers, big banks, they know they have to put their money somewhere. They have to perform for their customers. So money flows back into stocks. This is a pretty big move. So people are saying, okay, well, we've had a good sell-off, it's time to buy back in. So the pullbacks will always get bought up again. And you can use these patterns to kind of gauge, okay, well, when should I get in? Well, I'd like to see what happens on, you know, Monday, Tuesday, Wednesday, next week. Will the Nasdaq be able to stay above the 50-day moving average? Or will it get knocked back down again? There's always a chance it could get knocked back down again. But in the long run, in the long run, it's going to move higher. Eventually, do you have the, you know, the stomach to wait it out? Can you wait it out? Or like I said, are you here to just make money on a daily basis to pay for your bills? In that case, it's harder to do that. But if you have a longer term timeframe, you can wait it out a little bit. Let's take a look at the Dow because the Dow has been really strong. Dow has been the strongest of the three indexes over the last couple of weeks or so. Let's pull this down a little bit here. So the Dow fell through the 20-day, never got down fully to the 50-day and popped back up yesterday. Here we are. So the Dow is still very, very strong. Looks good. You know, if you're, once again, if you're waiting for that time to get in on a bull's position, wait for a pullback to either the 20-day or 50-day and you start to nibble. And when you see it really starting to move back up, then you can get buying more. You know, everyone thinks, well, I don't want to buy at the high. I don't want to buy at the high. But if you think that, if you think, you know, if you think this was the high and you're like, I don't want to wait for a big pullback, well, did that big pullback come? Now you think, okay, well, here's a new high. I don't want to buy at a new high. I'm going to wait for a big pullback. Well, it keeps going up and you keep missing out on your opportunity. There's nothing wrong with buying on a high. Yes, it may pull back, but eventually it will keep going up. That's just how the market works. You'll have pullbacks and then it keeps going up. As long as companies keep putting out products that people want to buy and people have cash to buy those products, the earnings of those companies go up and the stock prices eventually follow those earnings. That's how the stock market works. That's just how it works. It's worked that way since the inception of the market. Here's the Dow Jones Industrial over time, back to the 1980s, just keeps going up over time. All right. And another thing we like to look at is let's look at the VIX because we haven't looked at the VIX all that much lately. Now, the VIX is the volatility indicator showing you when things start to, when the stock market sells off, volatility goes up. It's an inverse indicator. When stocks sell off, volatility goes up. So let's pull this out to the daily chart. What we know is that when the VIX spikes, it lasts a very short period of time, maybe a day or two at most, three days max on a lot of occasions. What does that mean? Well, when the stock market sells off, the VIX, the volatility will spike and it doesn't matter the absolute numbers. So here's like 30%, and here's the height of the pandemic at 85%. The key is that the spikes only last a couple of days. You can see spike here, spike here, spike here, spike here, spike here. They're only a couple of days max. And when it starts to sell off the volatility level, that means the stock market is going back up. So the VIX spiked almost up to 30, but now it finished yesterday at under 19. So it gets a quick move and then a quick move down. So that means the stock market is ready to go back up again. So we like to look at the VIX sometimes to see what's happening. So that's the general market we got the Dow, the S&P 500 and the NASDAQ. I'm still bullish. The NASDAQ got hit the hardest, but the bottom feeders come out. People have to buy these stocks. The mutual fund managers, the hedge fund managers, they have to put their money somewhere and they want to get a good return for their customers. So of course, they're going to buy the tech stocks because those always move the most in certain times. So people will start to buy back in and the markets will go back up after pullbacks. It's just how it is. So let's take a look at some individual stocks as we always do. We look at Apple because we always look at Apple. Apple and you'll see a lot of these tech stocks have pretty ugly looking charts at times. For a while here, let me open this up a little bit. We had talked about the W pattern, had the top here, the resistance it went through. A couple of weeks ago I said Apple was ready to go. It was ready to go. Had earnings, earnings were good. And then it just got caught up in the tech down move. It went through the 20-day moving average, went back through the resistance line, went down below the 50-day moving average and then stopped right on the 200-day average right here. And it bounced. And yesterday it closed above the 50-day moving average. Here's the 50-day moving average. Here's where it closed. You see a little dash mark on the right side of the chart of the bar here. And so our next line of resistance once again is this line right here, this horizontal line. We want to see Apple move above that and start to move back up towards its all-time highs near 145. So it's been hit or miss. Apple goes up, it comes down, it goes up, it comes down and it's just still hovering around this 125-130 level. That's just what's been happening. It's been kind of frustrating. But you take what the market gives. I'm still long-term bullish on Apple. I'm holding on and eventually I know it will go up over time. Let's take a look at AMD because that's another stock that we play quite a bit with in the smart option seller. AMD has been kind of frustrating as well. We had the W patterns, got up above it a little bit and then entered this nice downtrend, had another W here. Pop thought this was the move, thought we were finally going to go and it just got caught up in that last few weeks' downtrend in the tech market. Here's our long-term support right here, this line right here. It went down below it a couple of times, but Friday yesterday it popped back up above it, closed above it. So I'd really, would like to see AMD start to move up again. We have, make it put positions that we sold in AMD, still have buffer, still have buffer down here. We may end up rolling at some point if AMD starts to keep selling off. But if we have to buy the stock, I think it's going to be a great long-term investment. So that's AMD. What other stocks? Microsoft still kind of hugging the 50-day moving average line in and up in a nice uptrend. Let's pull this out a little here. Still in a nice uptrend. You can always draw lines, support lines. You can always draw trend lines. You want to connect most of the bottom prices here. So it's in the eye of the beholder. The way I draw a line might be different than the way someone else may draw a line, but you can certainly see there's a nice uptrend here. And you can draw lines along the tops too and can create this channel. That's part of technical analysis. So within the confines of this channel, Microsoft goes up, it comes down, it goes up, comes down. So we've got the bounce here and it bounced above the 50-day moving average as well. So maybe Microsoft makes its way up towards the top of the channel as the next move, but it's still in the uptrend. So as far as I'm concerned, Microsoft is still in a bullish position. Intel is another stock that had some action. Earnings knocked it back down, but you can see it bounce right on the 200-day moving average. Would I get a bullish here on Intel? I don't know. Jury's still out. I like AMD better even though AMD's been selling off, but Intel has come off of pretty decent ways. It's come off about $12-$13 or so. So if you're looking to bottom pick a little bit, maybe you nibble here. It bounced off the 200-day moving average. It's getting pretty oversold in the RSI. So maybe Intel could be worth a little bit of a bullish position here if you're game for that. What other stocks do we like to take a look at? Let's look at Tesla. Tesla also has a pretty ugly chart. You can see right here it tagged the 200-day moving average. That's sort of the last line in the sand. We really don't want to see a bullish position if you're bullish Tesla. You don't want to see it really go much below the 200-day moving average more than a couple of days. You want to see it bounce, but it did tag the 200-day. It closed above it yesterday if you can see the dash on the right side of the bar. So I guess it's comforting that it bounced at the 200-day moving average, but it's fallen a long way from 900 all the way down to below 600. It's fallen a good way. Getting a little bit oversold on the RSI. So maybe we have a bounce next week. We need Tesla to go back up. We've sold some put spreads. Still have some cushion down here, but we want to see Tesla start to move back up. Let's take a look at some other stocks. I want to show you some stocks that I like, the uptrends that they're in. So you always want to look at uptrends and see how the stocks are bouncing off those uptrends. Let's look at Oracle because I like the way the chart looks. Oracle has had a nice move higher, bounces off the 20-day moving average, bounce right here again off the 20-day moving average. So Oracle's in a nice little uptrend. I was to get long, possibly maybe wait for the next pullback here if it occurs, maybe to the 50-day, but it's in a nice little uptrend. Cisco has somewhat of the same chart pattern as Oracle. Got a nice little uptrend, bounces off the 20-day or 50-day. This could have been a nice little entry here or even right here. So Cisco's moving up nicely. Coca-Cola. I like as well. You can see the similarities in these charts. They have a nice uptrend. They're hugging either the 20-day or 50-day moving average. Coca-Cola looks good, looks ready to keep going. We've got, if I want to draw some resistance here, you know, maybe right here got some, the resistance that Coke has sort of popped through, opened this up a little more so you can see it, popped through it here, popped through it here. So maybe in the next couple days, it can get through it with some force. If it can get through this line with some force, maybe around $55 or so, it could be on its way to maybe taking out its all-time highs here of $60 a share. Let's see if that was Coke's all-time high. Yep. Right around $60 is a monthly chart. So the next spot we'd like to see Coca-Cola go to is $60. If it can get through this $55 resistance line, it should be off to the races. Colgate. Colgate, I like Colgate a little bit as well. It's got a nice little uptrend here. Doing pretty good. Never tagged the 20-day here, but starting to move back up. What other stock did I have? Oh, let's see Procter and Gamble. So these are the, you know, these are the stalwarts of the Dow. You've got these companies, Procter and Gamble, Colgate, Palmao. These are, they make products that we use practically every day in our lives. Procter and Gamble looks pretty good. Starting to move up again. Let me see what other stocks we have here that I might like to take. Let's look at Amazon and Netflix as well. We'd like to look at the tech stocks because those are the ones that move the most. Those are the ones that a lot of people play with, you know, still once again in this long-term channel. Hit the top. I mean, exactly hit the top right here. I mean, I drew this line a long time ago and look where it stopped right at the line. It got knocked back down again. And you know, let's redo this line. You know, this is all part of technical analysis. You draw your trend lines. Okay, so this is the line we can use going forward for now to see where Amazon, I don't think we really wanted to see it fall all the way back to, you know, under $29 a share, $2900 a share. So it's right in the middle here, our size sort of right in the middle. So Amazon might creep around sideways or hopefully you can get its mojo and move back up again. Netflix, Netflix, still in this channel as well. But it's got hit pretty good. You know, the line of support is right here. That's around $460 a share. So we're just watching Netflix bounce around. Not much happening there. I don't have much of an opinion on that Netflix at the moment. Let's like kind of go through our list here. Oh, Walmart, Walmart, you know, I love Walmart. I'd gotten long some right around here, started to pop through the resistance line and bought a nibbled a little bit. And then it got knocked back down, but it popped back up the last two days. So right at the 20 day moving average, the blue line right here, open this up a little bit more, you can see. So Walmart's here, I'd like to see Walmart get back above the line right here is about $141 a share. I like to start moving back up. It's got earnings out on Tuesday this week coming. So let's see what happens. I'm a little nervous because last earnings have gotten knocked down pretty good. Don't know if the same will occur. So if you're playing Walmart, be careful, earnings on Tuesday. Let's see what else do we have that's worthy of looking at PayPal and Square to the online big payment companies. PayPal, you know, went up, knocked back down, had the W pattern here a little bit, but never got above the resistance line here, sold off quite a bit square. These two companies hugging the 200 day moving average line, I do like PayPal and Square, but I want to see if it could bounce here off the 200 day, getting a little oversold RSI doesn't mean it's ready to turn around right then and there, but we want to see some bottoming action here before possibly getting in that's what you want to see you don't want to always try to bottom feed you want to see some bottoming action before jumping in. All right, I think that's about it here. I'm just taking a look at some other charts here scrolling through the list. What do I like? Facebook, Facebook looks decent, kind of hugging the 20 day moving average line. IBM, IBM not bad hugging the 20 day moving average line. I don't talk about GameStop anymore. GameStop is just, you know, kind of stuck in this pattern here. I'll pull up GameStop. It's kind of getting in the sideways pattern now, not doing much hugging around 160 a share. All right, let's take a quick look at the S&P 500 one more time and get a gauge of what's happening next week. Pull up the SPY. You know, market to me looks good. It's a tag, the 50 day moving average line popped off above it. And I'm just hoping that we keep going. I mean, eventually I know we will keep going. But for now, you've got the headlines out there, interest rates, inflation that may stick around for a little bit, but earnings season is just about over. Companies did okay. So now we have to wait until the next round of earnings three months from now. What will happen between now and then? Well, I think the market's just going to keep going up in this trajectory. Sure, we'll have pullbacks, but in the long run it goes up. So I'm bullish for the long run. Short term is a little bit harder to predict because the market could be erratic on a day to day basis. So try to move your time frame out for a longer term. All right. So that's all for the Saturday synopsis. Let's quickly take go to our website. And as we always like to do smart option seller, put selling basics, that's our bread and butter. If you don't know much about put selling, go to our website, put your name and email address right in here. We'll send you a free copy. What we offer our services tab right here are two newsletters, smart option seller newsletter and the vertical spread trader newsletter. We sell put options, one-on-one coaching if you need some help getting to that next level. We've had a lot of success with our students in this YouTube video. Don't forget to subscribe. Hit that red subscribe button in the right hand corner, bottom right hand corner of the video. Leave me a comment, give me a thumbs up if you feel this is good information. Send me an email. I love hearing from you. Okay, that's all for me today. We're running about 50 minutes in this video. Keeps getting longer. Let me know if you like these longer videos or if you really want short videos. I'd like to give you some good information. It takes me a little time to go through it all. All right, that's all for me today. I hope everyone has a great weekend and week ahead and I'll see you all here next week. This is Lee Lowell signing off.