 Hi, everyone. Lee Lowell here, smartoptioncell.com. How are you all doing today? It is Saturday, August 14, 2021. Welcome to another edition of our Saturday Synopsis, where we like to take a look at the charts. We look at indexes. We look at individual stocks. I'm here to help you become a smarter and better trader. And what I'm trying to teach you here is what to look for on the charts. We look at support and resistance levels. We look at moving averages. We look at price patterns. So it's all about how to become a smarter and more profitable trader. I get people asking me all the time, Lee, what do you do? How do you pick your stocks? What do you look for? So to me, it's all about looking at the charts. I'd say 90% of my trading, 90% of how I pick stocks is based on technical analysis, which is just basically chart reading. Over the 30 years that I've been in the business, this is what I've done. These are the things I look for. And I try to show you what I look for because it's all about helping you and I want you to become a better trader. So let's just jump right in, take a look at the charts and see what we've seen, see what stocks are doing, and see what they may be doing moving forward. So let's open up here. Let's move to the SPY, which we always look at first. We'd like to take a look at the broad indexes first and see what the overall market is doing. The SPY, which is the exchange traded front of the SP500, we'd like to see what it's doing because it gives us a good overall view of the market. So if you've been watching these videos, you know I've been bullish. And in these videos, I show you what I use. I have daily bar charts, which is each one of these vertical lines is one day's worth of trading. And on the charts, I have three moving averages. I have a 20-day, 50-day, and 200-day. They're all simple moving averages. These three lines here, these are called moving averages. And they fall, they track the movement of the price movement of a stock or index. And down here is what I use the RSI indicator. It's a 14-day lookback period. And the RSI is an overbought, oversold indicator tells us if stocks or indexes are getting a little bit overbought or a little oversold. And we use the 80 level and the 20 level as our barometers. And those numbers can be changed. Whatever charting platform you use, you can always change the numbers. Okay, so we look for patterns. Patterns are a big part of how I find stocks that may be moving in one direction or another. What are patterns? Patterns are just these basically patterns that stock prices will make over time and they will repeat themselves over time. So in this case, it's called a W pattern. This is called a congestion pattern. This is called an ascending triangle or an ascending wedge. You can go online and you can just Google search, you know, technical stock patterns. And it'll come up with lots of websites or other free information you can get, or it'll show you books that people have written about. Technical analysis and different chart patterns. There's so many different chart patterns. There's channels and there's wedges and there's congestion patterns and there's W's and there's M's. There's all these different things that over time, stocks tend to repeat themselves. These patterns tend to repeat themselves. So it's good to have an eye to see if stocks are making certain patterns because typically they will lead themselves to a certain reaction to those patterns. Okay, so and also we like to see the general movement of prices themselves, just the general price action. Price action is just where's the stock going? And obviously, you can see here, since the end of the pandemic, March 2020, the general market has been moving higher. Prices have been going up. That's just how it is. Now, one thing I do want to stress is that individual stocks, how did their prices move? It's all based on how well the company is doing, how well the company is performing, how many, how much, how are their sales growing? How are their revenues going? How are their earnings? And a stock or a company over time will move based on how it's performing financially. If a stock is, if a company is making great products and selling more and more products every year, obviously their sales and revenues are going to go up every year. So that means the stock price is going to follow in the long run. In the short term, on a day-to-day basis, a stock can move in any direction. That's just, it's too random. Short-term trading, swing trading, day trading, weekly trading, it's very random. And unless you're super good, it's hard to make money on the very short term because stocks could just move randomly on just whatever news that's out there. But over the long run, as long as a company is creating great products and their sales are growing, the stock price will move up over time. That's what we want to look for. We want to look for stocks making upward movement over time. We'd like to be bullish because a majority of the time, stocks go up. Let's take a look. Let's pull back to a monthly chart here and you can see over time. This is the S&P 500 index. Over time, stocks go up. Over the last 200 years, stocks go up. It's been the best moneymaker out of all the things you can invest in over time, better than gold, better than CDs, better than bonds, even better than real estate. So stocks is where it's at. If you want to make money over the long run, you've got to have some exposure to stocks. So that's what we look for. So let's open this up. We can see, go back to the daily chart. Now some people use candlesticks. I use just your open high-low close bars. And what does that mean? Well, each vertical line is one day's worth of trading. And there's a little dash on the left side of each bar. And there's a little dash on the right side of each bar. If you can see, I know these are very small. But the dash on the left side is where the stock opened that day. And the dash on the right side is where the stock closed for that day. The top of each bar is the high of the day. And the low, the bottom of each bar is the low of the day. Some people like to keep those statistics. So obviously, we can see the S&P 500 has been moving up over time. And what you'll notice is that 20-day and 50-day moving averages, which is what a lot of people follow, right? When a lot of people follow the same thing, usually have the same outcomes, just self-fulfilling prophecies. That's just how it works. And you will see strongly trending stocks, whether it's up trending or down trending, will usually hug the 20-day or the 50-day moving averages. And by that, I mean, they go up and when stock prices pull back, they'll pull back to either the 50-day or the 20-day. And they'll usually bounce. As long as the stock stays in that same general motion, they'll typically bounce off one of those two lines when there's a pullback. So if you're looking to time your trades, if you're bullish and the stock's moving upwards, you want to try to time your trades when it has a little bit of a pullback to one of the trend lines. And then you can buy there when it starts to bounce, or you can try to pick a bottom and nibble a little and then wait for confirmation that it will bounce. So like I said, when stocks are trending strongly, they'll typically bounce off the 20-day or 50-day. Now, down here, there's the 200-day. It's a lot lower, placed well below the 20-day and 50-day. Now, sometimes stocks will have a good pullback to a 200-day. That's your line in the sand, whether this stock's going to bounce or it's going to keep going and its trajectory has changed, meaning something has come along and forced it to move from an uptrend to a downtrend. And we'll look at some other charts and see what that is. So the broader market itself is strong. It's moving up. It's been hugging the 20-day and every time it pulls back, it either bounces off the 20-day or 50-day. So if you've been looking to get into just your S&P 500 fund and you're trying to time it, here's your timing. You can buy here. You can buy here. You can buy here. You can buy here. You can buy here. Now, everyone will say, well, I don't want to buy at the top. What if the next bear market comes and then I'm the sucker that bought all the way at the top? Well, you have to step in at some point. I mean, you could have been saying that all along here. All right. Well, here's the top. It's never going to go up anymore. Well, actually, it went up. Okay. Well, here's the top. It's never going to go higher from there. Well, there it kept going. Well, here's the top. I'm not going to buy here. And it just keeps going and going. So you have to understand over time, companies that continue to do well, their stock prices are going to go up. And these indexes are made up of those companies. So if the individual companies are doing well, the index itself is going to do well. So why would you think that the next bear market's coming? That means that all the stocks are doing horribly at the same time. Now, yes, when the pandemic hit, which was out of our control, the COVID came along. So everyone's fears, the fears took over, thinking that every company was going to go out of business and no one's going to be making any more products. That was the height of the fear right here. And then when everyone came to their senses saying, you know what, we're going to get a vaccine, companies aren't going to go out of business. That's when the bottom happens. So, you know, bearing any kind of other major disaster geopolitical world event, like another pandemic, which we see that vaccines can be created relatively quickly, it's hard to imagine what's going to be the next bear market or what's going to cause the next bear market for an extended period of time. Yes, we'll have pullbacks. We'll have pullbacks, but it's not going to stop companies from creating new products and people buying those products and those companies being profitable. So you have to understand the psychology behind the stock market and why the stock market moves in a certain way. The stock market is meant to go higher over the long run. Pullbacks are meant to happen. Pullbacks are just normal parts of stock investing history. Yeah, a company may have a bad earnings or CEO may be corrupt, but it'll be replaced by better products and better CEOs. So you want to err on the side of caution, which is the market goes up over time. Okay, so we want to, I'm in for the long haul on both. Right now, things look good. The market is going up. It's been hugging the moving averages. So I'm staying long until something comes along and tells me it's not going up anymore. All right, so let's take a look at the NASDAQ. And we'll see that. And now the S&P 500 also made an all-time new high this week. So we're making all-time new highs just about every week. Here's the NASDAQ. It's been kind of flat the last two weeks, but you can see it's still hugging the 20-day moving average, the blue line right here. Okay, once in a while, it'll get down to the 50-day moving average. Now, here's the W pattern, just looking for patterns. This is typically a bullish pattern once it breaks above the resistance line, which it finally did. So it's starting to move higher. You want to look for these patterns. Market looks good. You know, there's nothing, it's going to stay in motion in the same motion until something comes along and knocks it down. And I can't see what that is right now. The Dow Jones industrial average, let's take a look. Blow this up a little. Now, the Dow finally been making this ascending wedge, which is a bullish pattern once it gets above the resistance line right here, which it did. So this past week right here, the Dow had a good week, finally convincingly got above the resistance line. You can see all this action right here. All this action right here was just storing up this energy, just trying to get through while still having an upward bias. All that energy and finally blasted through so the Dow had a good week and it looks strong. So there's really nothing from keeping it from going even higher. You know, what's going to stop it? So the Dow looks good. The S&P 500 looks good. The NASAC looks good. I'm all making all time new highs. Okay. So that's the indexes look strong. Let's take a look at some individual stocks and see what they are doing. We always start with Apple. We'd like to look at Apple. Now I had mentioned last week, blow this up. Apple, you know, had been kind of not doing much. We were getting a little frustrated. You know, here's the 200-day moving average. So I said that's the line in sand. One, two, three. So triple bottom right off the 200-day moving average was the, you know, the final thing that the bulls needed to convincingly say, it's time to go. It's time to get off our keyster and move up. And then Apple just went from $125 a share up to $150. Right? So it had a nice move. But now last week I said it's starting to, it has this, had a double top right here, which can be a short-term resistance area until Apple gets its bearings again and wants to make another attempt at making a new high. So we had this double top, had this sort of congestion pattern. Can't really see it right here. And it was just storing up energy to move one way or the other. And it meandered a little and now this week moved up again. So it's going to attack the all-time new highs at $150. It may make a triple top here, which could knock it down a little bit. So getting through $150 might be a little tougher over the next week or two. Just for now, it may knock it back down. But I think eventually it's going to make a hard core salt here and get through $150. But it may stick around here for a little bit. That's just my assessment. You know, Apple's still making tons of iPhones. People are buying iPhones. They're making lots of money. You know, what's the reason why Apple would start to go down and enter a bear market? There really is no reason. It may meander for a bit until it can convincingly get above this resistance line. So $150 is the line in the sand right now waiting for it to get through there. Let's take a look at Tesla. Tesla's still, you know, I drew this big triangle pattern last week, which is basically the ranges get smaller and smaller and smaller, builds up all this energy, and then all of a sudden it's going to break out in one direction or another. It looks like it broke out through the triangle here. So and it meandered for a week and a half. And it looks like it may want to continue to go higher. Once it blasts out in one direction, it will tend to keep going in that direction because people get geared up and say, oh, it's finally broke out. It's time to get bullish. As we get more people buying, obviously it's going to keep moving it up. So here it looks like a bullish breakout to me and it probably could keep going higher. Amazon and it's all about finding these patterns, looking at sport and resistance levels, looking at the moving averages. Try to keep it as simple as possible. Now, Amazon, as we know, had the big earnings gap right here, downward gap. It had been in this long channel, looked like it was finally breaking out, but then earnings came out and knocked it back down. So it's right smack back in the middle of the channel again. It will probably be a while before Amazon really gets moving in one direction or another sitting right on the 50-day moving average. Amazon will probably trade sideways for the next couple months or so until next earnings announcement. So if you're an option seller and you're selling iron condors, which is a combo of a call credit spread and a put credit spread, could be a good environment here if you want to sell those iron condors because Amazon most likely will stay in this channel. Let's take a look at some other stocks that we'd like to take a look at. Let's see what we got. Now AMD, we talked about AMD. I love AMD as a stock, as a company. We had talked about just missing out on a bullish trade right here. We sell put options. We missed it unfortunately and it went on this $40 run from $85 all the way up to almost $125 at this power blast hire. I liked the pullback here. I talked about it last week. Once you have a vertical move like this where stock just goes straight up, straight up, gravity will take over at some point and profit takers will take some money off the table. Other people will say it can't go any higher so they'll sell it and it's what it did. It sold off, went from about $122.5 down to $105. So it lost about $17 or so. And I'd like to wait for the pullback and I'd like to wait for the moving averages sort of catch up to the price action. You can see the moving averages moving a little more vertical, prices coming down. I don't know if they'll meet here because AMD had a pretty good day Friday, yesterday August 13th was up $4 or $5. Yep, $4. So here might have been the bottom of this pullback. Had the pullback. This might have been the bottom. It was kind of congesting here for a few days. Had the good move up. So I think AMD will sit here for a minute or a day or two. Moving averages will catch up and I think it's up for the next move. So I'm hoping to possibly get into a bullish trade maybe in the near future once I see a couple more days of price action on AMD. What else do we have? Netflix also looks very much like the Amazon chart channel. Channels just when a stock just keeps bouncing in between off the highs and lows of the upper and lower lines. And just like Amazon just kind of stuck here in the middle, not really going anywhere. So if you're an option seller selling those iron condors could be a good strategy right now as long as Netflix stays in this range. Not really doing much, don't have much an opinion there on Netflix. Cisco and like Cisco and Oracle, we'll take a look at Cisco here first. You can see it just kind of hugging. You can draw the support line which is connecting the bottoms and it was moving a little sideways kind of hugging both moving averages and it's just been going hard. Just this upward move. So I don't see anything that could really derail Cisco. I think earnings may be coming out next week. So we're going to wait for that. See what happens. Let's take a look at Oracle. I also like Oracle as a company. I think this was the earnings maybe, this little gap down here. But it said screw that and we're going higher. It's been hugging the 20 day moving average line and looking ready for another assault on all time new highs. Had the ascending wedge here. Did blast through it. Came down. I guess the earnings was here possibly. And then not sure what that does. That might have been earnings or not, but it just started to move higher. So I like Oracle. I like Cisco. What other stocks do we have here? The Proctor and Gamble moved out of that channel. Walmart. We talked about Walmart last week. I liked Walmart. It looked like it was ready to go. If you go back and watch last week's Saturday synopsis, you see that we talked about Walmart had been making the ascending triangle just waiting to blast through the resistance. So here's so this Friday, Thursday, Wednesday, Tuesday, Monday. So it ended last Friday right here. So when we made the video last week, this is where Walmart was. I said I like the pattern. I like the uptrend here. If it stays through the resistance, it's going to go and it had a good week right here. It went up about, you know, for Walmart, $5 move is a pretty good move in one week. So Walmart's looking strong. It may consolidate that move right here and could take on looking to take out its all time highs right there. Walmart is a favorite of mine. Disney, another one. Disney. Let's take a quick look at Disney. Now here's the difference. You can see Disney had the uptrending channel until something came along and knocked it back down. So here was a change in direction. So you can draw these these channels and then you wait to see what happens. So it was it was in an up channel, went to a down trend channel and then it had another sideways channel just waiting to break out. Disney had earnings the other day and it was up about $10, $11 on the high. You can see here's the high of the day yesterday, Friday, August 13, but then ended on the lows just just back into the bottom of the channel here at the top of the channel. So I think Disney will probably consolidate the the big move it had after a big move of stock likes to consolidate. That's just what happens. So it's probably going to consolidate right around the lows of this big bar here, right where the the line was for the prior resistance. Now it's actually become support. Now a prior resistance becomes support now. So Disney probably will meander around here. People come to their senses. They like what Disney's doing and it'll probably start to move up again. So I may be looking at potentially bullish strategies over the next week. Disney consolidates and if I see it starting to move up again, that is probably the the key or the cue that it's going to continue to move higher from there. So keep an eye on Disney. What else do we see? Now the health care stocks we like health care stocks or the pharmaceuticals have been going up. You got Eli Lilly just has this nice uptrend Bristol Myers has this nice trend. Let's take a look at Bristol Myers a little bit closer. Now if you want to draw trend lines, this is what you do. You get your trend line and you kind of draw the bottoms, right? You kind of connect the bottoms. It's not an exact science. Okay. And you connect the, let me bring this down a little. Come on. And we connect some of the tops. Now it depends on how far back you want to look. Okay. You can go here. You connect the tops. You connect the bottom. So Bristol Myers is in this sort of range here. It may bounce here and then start to move back up towards the top of the channel. This is what's called an uptrending channel. And if you're looking to get long, you wait for it to get close to the bottom or wait for a bounce off the bottom. What was I looking at? Visa, I think, has the same kind of Visa has sort of the same kind of channel. You can draw bottoms here. You know, it kind of connects some of these bottoms connect the tops. So Visa is in the same kind of channel. You might want to wait to see if it bounces here off the bottom channel, you know, it's more art than science. It's all eyeball, you know, depends on where you want to draw the lines, like we can, we can draw this maybe from here. No, no, let's not do that. Let's do this one down here. And, you know, maybe this line could be your channel or this line. It all depends how you see it. Okay. So it's not an exact science. So that's Visa. What else? So we're talking about the healthcare. Pfizer, look at this, Pfizer had a great move. That's a big move for Pfizer. Great move that may we're getting a little overbought here. Let me blow this up. So Pfizer had pretty vertical move, hitting some overbought. This is just telling you, hey, you know, things are getting a little overheated, we may start to see a pullback soon, but it doesn't mean that the bull run is over. It just means we may have a pullback, maybe to the 20 day moving average line before Pfizer gets going again. So that's Pfizer. Let's take a look at Merck also healthcare. Merck looks good. I like the I like the uptrend channel that Merck's creating right here. So we can kind of draw, we can kind of draw a little bit of an uptrending channel here, connect the tops to so Merck looks like it's in this channel. And maybe it had that bounce right here, it looks like it bounced off the, this is the 200 day moving average, bounced off of that looks like maybe it's ready to go up here towards 80 dollars a share, keep an eye on Merck for potential bullish Kellogg Kellogg also maybe having this kind of like sideways rounded bottom action here, Kellogg's looks like it may be ready to go. That was in the downtrend, broke out of it kind of sideways for a bit. Now looks like maybe it's ready to go assaults maybe all time new highs. Verizon, I like Verizon, but it's just not doing anything, right? So we're staying out of trades for Verizon right now, kind of in this downtrending channel not really do anything. There's no sense in fighting it. There's no sense in trying to pick a bottom. And because you're going to get frustrated, if it's still in a downtrend, and not showing you any signs of bullishness, don't buy, because it'll just frustrate you if it keeps kind of slowly, slowly creeping down, you're just going to get upset. So you wait for, wait for the bullish activity to come around, you may not buy the bottom, but you'll least you'll get in when it's moving in the right direction. So the XLV is the healthcare, healthcare ETF, I love the XLV, because these healthcare companies are so great, you can see it's just been hugging the 20 day moving average, like healthcare may want to get in, we may do some something with some bullish put spreads here, bounced off the 20 day. So I like the healthcare ETF looks good. What else we got? Let's look at so PayPal and Square are the two payment processors. PayPal has come come off this downward move, going sideways, not much opinion there, Square, same thing, Square looks pretty good though, it's in this uptrending channel right here, bouncing off the 20 day moving average. So Square probably looks strong, may bounce, once it connects with the 20 day moving average, people get ready to buy again. So Square looks stronger, Square looks stronger than PayPal, it's in this uptrending channel, so it may keep going, assaulting on all time new highs. And we got McDonald's in sort of in this channel, Pepsi, I think I like Pepsi a little bit better. Well, McDonald's and Pepsi is not the same industry, Pepsi looks strong, let's look at Coca Cola. Coca Cola, Coke and Pepsi, both look good, Coke's, you know, stalwart, Pepsi stalwart as well, Coke looks good, just kind of slowly hugging, slowly hugging the trend lines here, Coke looks strong, Pepsi looks decent. And Facebook, Facebook in that channel, same thing, we've had this for a while, in this uptrending channel, Facebook just continues to go up, bouncing in between, these are the things you want to look for. All right, so I don't really like to look at these meme stocks anymore, they're not really going anywhere, Peloton, not much happening there, and the QQQ, which is the exchange traded fund for the NASDAQ, looks strong, hugging, hugging the 20 day moving average. So if you want a broad exposure to the overall market, the SPY, the QQQ, the DIA, that's the diamonds for the Dow Jones, that's what you can get into, watch the trend lines. All right, so that's it for your Saturday synopsis, that's what's happening in the market, ambos, things look strong, things look good, companies are having good earnings, QQ earnings are just about over now, most of the companies did pretty well, and most of the outlooks for the future look pretty decent as well, that's what's going to keep stocks moving higher, positive outlooks. All right, so that's all here for the Saturday synopsis, I hope this has been helpful, give me a thumbs up in this YouTube video, leave me a comment, don't forget to subscribe, hit that red subscribe button. Quickly, let's go to our website, smartoptionseller.com, smartoptionseller.com here, get your free PutSellingBasics guide, go to our website and go to the PutSellingBasics, put your name, email, just we'll send you a free copy. If you want to learn about PutSelling, our services tab here, we have our two newsletters and our one-on-one coaching. All right, that's all for me today, I hope everyone has a great weekend and a great week ahead, this is Lee Lowell signing off.