By: Tom Gentile
on January 11th, 2022
The Follow through to the Up Side in Equities
Not only did the markets close near their highs of the day yesterday, they followed through with another day in which prices rose and also closed at or near their highs of the day today.
This is a bullish sign for the markets and has me expecting continued upward price action, but not without caution.
Overhead Resistance for SPY
In the chart image on the SPDR S&P 500 ETF Trust (SPY), the ETF that tries to replicate the returns of the S&P 500, you can see how the price on 470 was a resistance since early November 2021. It broke out above that only to fall back below it 5-trading days ago.
Yesterday and today’s price action has been a bit of a reprieve for the bulls, but for me to be even more confident in prices going higher I need to see SPY close above that 470 price.
If anyone is currently long bullish option trades, I would watch price action at 470 to make sure the markets continue higher or see if it is going to rollover.
App: Toms Option Tools
Market Insight articles may show images of lists of stocks meeting a variety of options parameters like Unusual Call and or Put activity or Expensive IV found on my app Toms Option Tools.
Other times the charts may work to amplify my educational points.
Those options data lists, however, can be found on my app Tom’s Option Tools. Use your device to search up and download this app and get free access to the Morning Reports section of the app.
Other parts of the app are available at a premium subscription rate, but the Morning Reports Lists are yours free.