 Hey everyone, Lee Lowell here, smartoptionslowell.com. How's everyone doing? Today is Saturday, May 7th, 2022. Good to be back. Was gone the last couple of weekends, just had too many family activities had to take care of. So didn't make videos the last couple of weeks, but good to be back here for the Saturday synopsis. And what do we do? We look at the chart, see what's going on in the market, see what's been happening, see what may be coming down the pike. And I know it's been pretty crazy the last couple of weeks, missed a lot of the action in these videos. So I want to jump right in and take a look and see what's been going on. I'm a technical analyst. I look at the charts that helps me decide when to get in and get out of trades. So I'm here to make these free videos, help you understand how to look at charts. If you've never looked at charts, show you what I'm seeing and maybe it can help you a little bit as well. All right, so let's just jump right and see what's been happening. Obviously, if you've been following the markets, you know the last couple of weeks has just been selling, selling, selling. There's just no two ways about it. The markets have come off. We're talking about the S&P 500, the Dow Jones Industrial and the NASDAQ. Those are the three big indexes, stock indexes here in the United States. And actually I want to bring up the E-mini futures here, E-mini S&P 500 futures because these things trade almost 24 hours a day during the week. So it encompasses all the activity throughout the night when the US markets are typically closed, the US stock markets are only open from 9.30 a.m. Eastern to 4.00 p.m. Eastern, but the futures market continues on all through the night. So it gets to see when the European markets open up, it reflects that as well. So we're gonna look at the futures and then we'll look at the stocks as well. So here's the E-mini S&P 500 futures. This is the front month right now, which is the June contract and these trade in quarterly. So the next front month would be September and that'll happen rollover during the third week of June. But anyway, regardless of that, what we want to do is just, you want to look at the price action. You want to see which way the markets are trending. And the best way to see price action is just look to see which way the market's trending. So here we have, we've talked about right at the beginning of 2022, the market has just been selling off and has had big snapback rallies, more sell-offs, big snapback rallies and sell-offs. This is what you call volatility. This is a lot of volatility. Now, prior to 2022 January, the market just went up nice and easy and we'll look at the SPY, get a little bit better view. You see, there's all these gaps in here. This is because when a futures contract first starts trading or first gets listed, this was listed back in last March of 2021. So there's not a lot of activity in these far month futures contracts until it gets closer to that date. And then you can see the bars start to fill up a lot more. Now, this is a daily chart that we look at. So each bar, each vertical line is one day's worth of trading. But from January, you can see the market's just been coming down with lots of ups and downs. That's volatility for you right there. And then just the last month or so has just been this constant selling, selling, selling. So we're certainly in an environment where selling is the trade du jour. It's just, that's how it is for right now. And there are multiple reasons why this is happening. For those of you following the news, we all know that there's this war going on in Ukraine with Russia. And that has really taken over the headlines for a majority of people trading in the markets. And because that's reverberating through all around the world. And in addition to that, because that causes a lot of unease, we don't know what's gonna happen from this thing. We don't know if the war is gonna stretch into other countries. So that's got a lot of people on edge. And when people are uncertain about events, they tend to sell stocks. And so that's part of the reason why we're selling up. Another part of the reason why is inflation. Prices are getting more expensive. So the US Federal Reserve and other central banks around the world may start, well here in the US, the central bank has already started to raise interest rates, okay? To fight off this inflation. Inflation is going up. So interest rates has to rise. That's how you cure inflation. And when interest rates rise, typically that's not a good sign for the market. Stocks usually tend to sell off when rates start to rise. And so all this is playing out. Now also actual companies are dealing with the supply chains that are being disrupted because of what's happening in China. China is undergoing a massive COVID problem right now. And so that's causing them, that whole country basically to be on lockdown. So you don't have enough workers creating the products that get shipped to around the world. So companies can sell those products. So we have this supply chain bottleneck that's being backed up. So companies are reporting earnings from the first couple months of 2022 saying, their sales haven't been that great because they can't get the materials, they can't get the supply. So we have that problem. And COVID itself is just still lingering around the world. And that causes people to stay home. They can't go to work. And when no one's working, no one's creating products. So that just causes a whole big mess. The supply chains and companies can't get things they need. So they can't sell products. So they're making less money. So their earnings goes down. So you've got all these massive major news stories all happening at the same time. Now, if we had one of these news stories, that would be big enough because these are all major stories, but you got them all at the same time and you can see it's a recipe for selling in the market. Now, this will all get resolved at some point. We just don't know when. So until that time, the market's gonna stay on edge. It's gonna tend to sell off more. Now we'll get these snapback rallies. You see, you got a rally here, then sell off and then a rally here, sell off. So at the moment, a lot of the rallies tend to be sold. Anytime we get a good rally, it's gonna get sold off because people are thankful that the market rallied back up so now they can sell their positions. So for right now, we're just seeing any kind of rally that's being sold. And now as far as what we can tell from the charts where the market may be headed is that all these prior lows have been violated now. So this is the S&P 500. So we had a low here that got violated by this one, rally back up. So this was our main source of potential support. This was the February low that we had when Russia first invaded Ukraine. So we had this big one day washdown and then the snapback. So a few weeks prior, this is where we were a few weeks ago, this is the area that we were looking at that we hoped that the market would not fall below. You always use past levels to kind of gauge where the market may set its targets. And over the last couple of weeks, we see now this area was violated because you can see here it traded lower than this spot here. So the market to me is, I think it's got some more potential to go down. What we're probably looking for and what could help end this sell off is we need that one day massive washout just a one day just incredible selling volume where everyone just gives up and says, I'm out, I'm done. I don't wanna play the stock market anymore. So you get that one long bar that everyone decides to just puke all the positions and then that's when we get the snapback rally and you'll see the RSI go down as well to oversold areas. We haven't seen that yet. This has just been a constant drip, drip, drip. There's not enough panic out there for a bottom to form. When we get that one day washout where everyone just panics, that's when the bottom is in. But until that happens, we may just continue to see this drip, drip, drip selling every day. It's just agonizing to watch, watch your long bullish positions. If you have bullish positions, just get chipped away every day. It's hard to watch in this kind of environment and this is a long period of time. You know, this is five months worth now of just constant selling. It's a lot to take, you're seeing your positions, dwindling value, it's hard on your emotions, it's hard on the psyche. Nobody wants to see the market come up. You know, unless you're a short player and you're selling stocks, you're buying put options, that could work for a period of time. But we know in the long run, the market goes up. Let's look at the SPY and just we can see a longer term view versus the futures. Now you can see, you know, this is about two years worth of time on the whole screen here. So you can see this nice, steady up market. That's what we like to see in the long run. Okay, but we basically, here's January, we've just had this selling, just constant selling. And it looks very much like the futures market here was that February low, I was talking about. So the market has now violated this past low. RSI's still not oversold yet. So we probably will see some more selling leading into that massive one day washout whenever that may occur. Earning season, quarter one earning season, most of the big companies have already announced their earnings, it's been a mixed bag. Some have been decent, some have not been decent. So it's kind of, they cancel each other out. So there's just that general selling that's still happening. Now, if a lot of the companies were having good earnings and projecting good earnings into the future, then we probably would have seen the market go up. But some are still concerned for the next three months that the supply chain won't ease up. So they're projecting the next quarter might not be that great either. So that tends to lead to more selling. So I think we have a little more selling to go leading into that potential one day washout. And let's look at the NASDAQ because that's been getting hit pretty hard. That the NASDAQ's been getting hit harder than any of the three indexes, tech stocks. We all know tech stocks will look at a lot of these stocks and see just how far they've come off. But you know, you've got this, the last month has just been this constant, harsh, violent, aggressive selling. And it's been hard to watch. And even here, it's still not really getting into oversold levels, even though the market is coming down, the RSI is not really budging. Now that could be a good thing as well. If the RSI is not really heading into oversold levels, that could also mean that the selling is sort of slowing down. So obviously there's no guarantees on what these technical indicators can tell us, but they can give us clues. I still think we may have that one day washout and then we'll have the snapback rally. But as long as these news items are still out there, there's still gonna be enough fear that could control the market. So it's a very fluid situation. It's a scary situation, but we know over time, the market will rally back. It's just we have to get past these things that are happening around the world. Because if we dial back out to the long-term chart, we know the market goes up. And so we're looking at basically from 2001, the market has just gone straight up. And believe me, there was plenty of news stories over these last 20 years, bad news stories like what's happening now that will control the market in the short term, but eventually things will resolve, things will settle down and the market will continue on. Remember, the market is made up of companies and companies creating products that are earnings that are earning more and more profits quarter after quarter and that's gonna lead stock prices higher. What we're having now is just a temporary blip. You think Apple is just gonna go out of business and never sell iPhones anymore? It's not gonna happen. We're gonna have a temporary pullback because of what's happening around the world when that all gets resolved, the market will start to go back up. But it depends on your timeframe. Okay, if you're a long-term hold, if you're a long-term holder, like I am, sometimes you have to gut it out, you have to weather these storms, you have to weather the pullbacks. And what you can do, or what I do in cases like this on pullbacks is that I have some free cash, some dry powder to expend that I start to buy some of these stocks and indexes on the way down, nibble here and there. That's what I've been doing. SPY? I'm a holder of the whole market. The SPY is basically you're buying the S&P 500. So when you get pullbacks, it is an opportunity to buy if that's what you are planning on doing for the long run. If you're planning on holding for the long run, there's a point where if you wanna be in the market, you have to buy. Now, certainly you can buy on the way up. That gives you more confidence on the way up you can buy in the dips when it bounces off the moving averages. But it's a little scarier buying when everything's selling off like this. But I know a lot of people will always tell me, I'm just gonna wait for the market to pull back, then I'll buy. When the market has a pullback, then I'll buy. All right, so now we're having our pullback. Are you buying it? Well, it's still a little scary out there. So I'm gonna wait a little bit longer until the bottom comes in. Well, nobody knows when the bottom comes in. How are you ever gonna know? Well, I'll just know. I'll buy when the market pulls off more. All right, well, the market's been pulling off more. How much, where are you waiting to buy? Well, I'll just, I'll know. I'll just buy when I know the market bottoms. Well, then the market bottoms and people will say, well, it might keep going down. So eventually you end up missing the bottom. Now, same thing when we hit the pandemic low in March of 2020, people are saying the same thing. So I can't buy now because everything's really bad and the market snapped back and kept going up, up, up. So everyone missed their opportunity. So now you're getting another chance to buy on a pullback. Well, you know, there's too much stuff happening. I can't buy right now. And then eventually the market will turn up and they'll have missed their opportunity. So for me, buying little bits and pieces on the way down, not putting out the whole lot, I'm just buying little bits and pieces and then I'll wait for the turnaround. That's just how I'm doing it. I'm not, this is not a recommendation. It's just, that's the way I'm doing it. And select stocks that I think are worth holding for the long run as well. So that's the, the SPY, the NASDAQ represented by the QQQ, you know, selling is, selling is happening and we probably have some more selling to go until these news items start to ease up. We may see that hopefully that one day washout that as tough as that is to watch, that could be the bottom. Now let's look at the VIX real quick because we talk about volatility here and the VIX, you know, basically gives you an idea of how volatile the market is. It's also called the fear index. The VIX is related to option prices. So when the VIX rallies or goes up, option prices become more expensive. Now since we're option traders, the VIX is very important to us. Now the VIX is the volatility indicator for the S&P 500 index itself. Now each individual stock has its own volatility levels also. So you have to dial down to see what the volatility level is for each stock. But the VIX gives you a pretty good indicator of how the overall market is performing. And the VIX moves inversely to stock market direction. So as stocks have been going down, the VIX has been going up. It just means there's a lot of fear out there. The ups and downs of the market have gotten a lot bigger. And so over the long run, you know, the VIX, there is a level where it typically doesn't go above. And we can see in the long run, we get these moves up. So I'm hoping that if we get that one day washout in the stock market, the VIX will have its one day rally up and then it'll start to come down again. So the VIX is the fear indicator. It's been moving up obviously because stocks prices have been going down. And if you're an option trader, you know, if you're an option seller specifically, this is a better environment for you to sell options because option prices are more expensive. But you also have to be aware that stock prices are also gonna fluctuate more. That could scare you out of position. So it's kind of a double-edged sword here. Yes, option prices are more expensive. You figure I'll sell option prices, but the ultimate deciding factor of that, how that option position will perform is where the stock ends up going, is going up or down. So be careful if you're playing volatility in that regard. Let's take a look at some individual stocks here. We'll basically look at the biggies because that's what a lot of people are playing these days. Let's look at Apple first. Apple actually has been holding up pretty well of late. Here's the 200-day moving average right here. So you can see, it's trying to hold that 200-day moving average, but obviously it's below it. Apple's been coming off just like everything else that had this nice rally and then it's been selling off again. So it's trying to find some support here in the long run. It'll go back up. You have to pick your spots if you're buying some shares of Apple, but it's certainly coming off like many of the other stocks. Amazon, if you've been following Amazon, had a horrible earnings announcement right here, had the air pocket and just has dumped. I mean, Amazon. And it finally broke out of this long trending channel and it's dumped down here. So getting close to $2,300 a share was up at $3,400 up here so it's lost $1,100 per share. That's a big move. It's a big move. So Amazon didn't do so well last week with earnings. Selling is happening. We can't deny that. That's what we call follow price action. Price action is telling us things are being sold off. Netflix still going down, had the earnings here, traded sideways, had the earnings here. Now it's just still going down. It's a tough one. Netflix is hard. It's a great company, great idea, streaming and all that, excuse me. But $180 a share now, it's been hit pretty hard. It's got oversold. Look at the RSI, it got oversold here on that last earnings, bounced back a little bit but still came down, got a little oversold again here and RSI rallied back a little bit but stock prices still kept going down. It's a tough one. At this point, Netflix, I'm staying away from some of these, if you're a real aggressive put option seller where you're taking a stab at setting a floor price where you would potentially buy the stock, you can sell the 100 puts, the 90 puts, the 80 puts depending on which expiration is. So if you're itching to potentially buy some shares of Netflix a lot lower, you can look at selling some put options down here. If the stock keeps dropping, then you'll be on the hook to buy the shares. So make sure it's at a level that you'd be comfortable buying those shares. That's Netflix, what else? AMD, we look at AMD if it'll pull up. Come on, where are you? Hang on here. Okay, there we go, AMD had a minor glitch with the data feed here. AMD, I always talk about AMD because I'm long shares of AMD. AMD just been in this downtrending channel just like everything else. I'm gonna take off some of these old chart patterns you can see visually by just following the price action, AMD is in this downtrending channel. Don't have to draw perfect lines, it's just to get you to see which way the market's moving. So we put some levels down here and down here. So the last support level was around $85 from its last low way back here last summer. That's when it started rally. The other potential support area near low 70s is the other low from over here. So AMD has bounced off this first low here around $85 rallied back up this week. Maybe it can rally back up to the lower edge of this downtrending channel. What we're gonna need to see here specifically on AMD and the rest of the market, the stock has to get above this moving average which is the 50 day right here and then get up and outside of the downtrending channel for us to have any kind of confidence that the stock may continue up. I'd been a buyer at the $100 level because that was the last support. And now I've been kind of holding off waiting for it to rally back up. You know, this is what happens. I buy some on the dips and those current positions are underwater. That's just what happens. Sometimes you have to wait it out. Same thing with Disney. I've been a buyer of Disney. 130 was my level because that was prior support and it has blasted through that. Bought a little bit more somewhere around here. Tried to see if we can find a balance but I'm holding off for now. Now I've just been selling some put options on Disney way down here, you know, way down here trying to get some money out of these options. And if Disney keeps dropping and I have to be assigned, all right, I'll buy some shares of Disney all the way down here. If you look at the monthly chart, here's the support, long-term support right around where are we here, 80, probably around around $90 for Disney is maybe a next support. Here's the pandemic low, right around $80. So who knows, maybe Disney will come down there. You know, I've been selling some put options down in this area. We'll see. I'm willing to hold Disney for the long run. I know it's not going out of business. Some stuff happening in Orlando, Florida with the Florida governor and Disney. You know, I don't really wanna talk about that but Disney great company been around a long time. You know, it's gonna snap back at some point. It's just whether you can hold out till then. So I bought some shares. Now just kind of waiting to see what happened. See what happens. What else we got? Let's look at some of these stocks that had just been really getting hit. You know, a lot of these Momo stocks, a lot of these stocks that people were just loving for a long period of time. We can look at, you know, companies like Zoom. We all use Zoom. We've been using Zoom, but Zoom is just, you know, here was the, it hit a high of $575 and just just down, down, down, down under $100 now. T-Doc, Teladoc. Yeah, I'm just bringing up some of these random, these random stocks that people were loving for a period of time, $300 now all the way down to $33. Docu, DocuSign. I use, I've used DocuSign to sign documents. I'm sure everyone else has. But does that make for a great company? $300 all the way down to $75. What other some of these stocks? Palantir, I'm just thinking off the top of my head a lot of these stocks that I've heard of, you know, hit 45, it's now under 10. But some of these other biggies, NVIDIA, they're a great chip, computer chip company, had the support here and it has now fallen below that. So once again, we're probably gonna have to look for that one day washout for these, for the stocks to find a bottom. Adobe, another company that's come down $700. Now it's under $400. Facebook actually bounced back because it had decent earnings, had made a low here, then the earnings popped up nicely. But still, it's tough. These stocks have all been getting hit pretty hard. What stocks are going up? Are there stocks that are going up? Well, yes, we've got some energy stocks. We can look at Exxon Mobil, Exxon Mobil one of the biggest oil companies around the world and especially in the United States. Look at this chart, going up nicely. So energies have been doing okay. Certain companies, Coca-Cola, we talk about a great stalwart been going up, going up, going up. On the other hand, Nike, another stalwart of a brand has been coming off and it got hit pretty hard the last couple of days. So you have to pick your spots, pick your companies. Some other stocks that have been going up, Utility Company's Con Edison, this is Con Edison, ED is the symbol, biggest utility companies in New York been going up. So there are stocks that are going up. You have to find these stocks if this is what you want to invest in. But a lot of these high flyers are what people get enthused about because they had run up so much during the pandemic and people still buying call options on these things and getting hurt and it's unfortunate. Let me go through my list here, see. Oh, Walmart, let's take a look at Walmart. Another stalwart got hit pretty good yesterday, Friday, May 6th, but overall it's been going up pretty good. Walmart is a stalwart for me. The healthcare stocks, let's look at, let me go through the list here. So Intel, not so great. Proctor and Gamble, hanging in there. Oh, we haven't looked at Tesla. Geez, forgot about Tesla. Let's look at Tesla real quick. Everyone loves Tesla. It's got some big ranges here. Got some big ranges. It's just, it's still hanging around the 200 day moving average. People don't want to see this thing drop. I mean, some people do, but most people want to see this thing keep rallying. Elon Musk been in the news a lot of late. His Twitter deal so far is going through. It's not a done deal yet, but looks like it may happen. So Tesla's kind of hanging around the 200 day moving average. What are some of these other companies? Let's look at the list. Well, we can look at some of the Bitcoin stocks. So Riot, these seem to be moving along with the general stock market of late. So Riot's coming down under $10. Mara, Marathon Digital is the other big Bitcoin stock coming down as well. Let's see what else is on the list here. Oh, the healthcare stocks. So we got Bristol Myers still kind of hanging around near the tops, Pfizer hanging around the 200 day moving average, Merck going up. Where's my J and J? Johnson and Johnson coming back a little bit, but had the nice rally. XLV, XLV is the healthcare ETF. We have position in that in our vertical spread newsletter. PayPal, all right. So we wanna talk about PayPal a little bit. PayPal, just we had a position we had to get out of because it just kept dropping too much. It's falling below the support area, getting close to $80 a share. Although in one of our newsletters, we did sell put options on PayPal, taking a stab at a 50% another haircut. So we sold some put options down here, be willing to potentially get assigned and buy some shares of PayPal way down here, almost near the IPO levels. So we're taking a chance on that. That's PayPal Square, the other biggie in the online payment sector, starting to move up, but now it's just crapped out again. So everything's been selling off for the most part. 99% of stocks are selling off. So if you're losing money on both positions, you're not alone. It's just, this is the atmosphere of the market right now. And we know eventually it will go back up. But if you're a short-term player, day trader, swing trader, things are hard. It's hard to make money on in that type of trading if you don't know what you're doing. If you're just randomly stabbing at buying call options, it's not gonna work out well for you. You have to have some kind of system. So let's finish up here, look at the SPY again. The market, there could be more selling coming along, especially that one-day washout. It's just the environment of the market right now. This is something that you have to weather out, weather through, and I'm doing the same. And I'm trying to make the best recommendations for the newsletters right now. Once again, we're a little bit light on positions because the market's telling us to stay out of bullish positions. The market's coming off, that's the price action. So we're being very cautious here. That's just how it is. Sometimes trading, you're not doing anything. Sometimes sitting on the sidelines is the best thing you could be doing. You don't wanna put your money out there if the price action's telling you you shouldn't be putting your money out there. That's just being smart trader. I know people are always itching to get some action to do something. And that's the fastest way to lose money, especially if you don't know what you're doing. So when things are telling you stay out, stay out, sit on your hands. Cash is a position. Doesn't do much for you, but it's still a position. You can't lose it if you're not putting it into the market in unsafe environments. All right, so that's really all I have to say. Could be more selling coming along, would like to see the market go back up again, but the momentum is certainly down right now. And so we may have to endure some more of that selling. All right, so that's all for the Saturday synopsis. Let's take a quick look at our website. Once again, smartoptionseller.com. Our main theme is selling options. So specifically put options and put option credit spreads. They're more bullish trades. We use those because the market tends to go up more than it goes down over time, over the long run. In these short bouts, yes, the market can go down, but we still like to sell put options. So if you don't know what selling put options is, go to our website, get our free copy, put your name and email address here. We'll send you a free copy. What do we offer? Our services tab here, we have two newsletters. We have a naked put selling newsletter and a put option credit spread newsletter. And we also offer our one-on-one coaching. If you wanna get some more information on how to trade options. So take a look at that if you're interested. All right, so that's all for today. I hope this YouTube video is helpful to you. Give me a thumbs up, leave me a comment. Don't forget to subscribe. Hit that red subscribe button in the bottom right-hand corner of this video. I love hearing from you. Get some great questions all the time. And I always try to answer your questions. All right, that's all for me today. I hope everyone has a great weekend and a great trading week ahead. Hope to see you back here next Saturday. This is Lee Lowell signing off.