Week of July 28

Blow off top?

Recap of last week

The crowd was all in on the post-July OPEX correction and we said higher first.

We were spot on with the overall market direction. Unfortunately, really not much opportunity last week as the intraday ranges dipped below 40bps, which is multi-year lows. As a trader I look to transact when the market is deeply out of balance, when either sellers or buyers overextend themselves and are in a vulnerable state. Not much of that the past week, it was just a very very low volatility meltup with no real levels to lean against.

We ended up a small +20pts on NQ last week. We also sold puts on PM before earnings which results in a loss, and got assigned the shares. Not the greatest week of trading, but all we can do is take what the market gives us, and it didnt give us much last week. The important part here is to not get lulled into a daze here, as I expect volatility to pickup dramatically soon, with this week having FOMC, big tech earnings, and NFP all rolled into one.

As we enter next week, the market is pretty overbought, heading into a catalyst heavy week. Is it time to play mean reversion?

Next move for markets