Is the bull run in SPY and QQQ over? SMCI's predictable sell off. My plan for Tuesday March 19
Will FOMC tomorrow support or break the market rally?
Good morning traders.
If you aren’t part of the live alerts and commentary, consider joining THT PRO. There are times where price action and opportunity develops after I publish in the morning and my focus will shift off the watchlist. This happened yesterday and I will explain how I recognized each opportunity and planned each trade.
Market is gapping down in premarket so I’ll share what stocks and option contracts I’m hawking for today.
Introduction (for New Readers)
Welcome to my blog on Two Hour Trading, your daily source for market insights and trading opportunities. In this blog, I will provide you with a comprehensive analysis of the market, educational lessons, and trade ideas to help you stay ahead in your trading journey and best of all doing it less than two hours a day.
What Subscribers Get
Subscribers to this blog will receive daily updates on market analysis, educational content, and up to three trade ideas each morning, all based on real-life examples and my personal approach to trading.
NOTE: screenshots from chat are from Edge Trade Planner. A platform available to THT PRO members. Join Us for live commentary and planning. Note my goal is to actively trade less than 2 hours a day finding 1 to 4 great trades a day.
What is Two Hour Trading?
It’s my system for finding and executing trades while spending less than two hours a day trading. My goal is to earn 100-300% on the capital I risk while waiting for 1000%+ gain trades to setup. Key benefits:
High Quality trades with great reward vs risk
Avoid Overtrading and losses from it
Trading to Win vs Trading to Not Lose
Stacking the deck in your favor
2024 Alert Leaderboard
(I’ve decided to include a leaderboard so you can see what potential the 2 Hour Trading System has)
The following is based on entry alerts.
Mar 18 - GOOGL 147p Entry $0.65 - High after $1.71 ($650 → $1700 potential)
*runner for swing still in processMar 18 - SMCI 900p Entry $10 - High after $30 ($1000 → $3000 potenital)
*runner for swing still in processMar 14 - SPX 5150c Entry $3 - High after $10.50 ($3000 → $10500 potential)
Mar 12 - SPX 5150c Entry $4 - High after $27.50 ($4000 → $27500 potential)
Mar 11 - SPX 5120c Entry $3 - High after 7.50 ($3000 → $7500 potential)
Mar 8 - SMCI 1150p Entry $5 - High after $56.20 ($500 → $5620 potential)
Mar 8 - AMD 220c Entry $0.50 - High after $7.65 ($500 → $7650 potential)
Mar 7 - SPX 5175c Entry $0.50 - High after $2.40 ($500→ $2400 potential)
Mar 6 - SPX 5120c Entry $3.50 - High after $12+ ($3500→ $12000 potential)
Mar 5 - SPX 5070c Entry $0.50 - High after $10.75 ($500 → $10750 potential)
** alerted 0.30 entry wanted. dipped to 0.40. entered at 0.50Mar 5 - SPX 5070p Entry $1 - High after $13.50 ($1000 → $13500 potential)
Mar 4 - SMCI 1200c Entry $33 - High after $61 ($3300 —> $6100 potential)
Mar 1 - SPX 5120c Entry $2 - High after $20 ($2000 —> $20000 potential)
Feb 29 - SPX 5095c Entry 0.50 - High after $10 ($500 —> $10000 potential)
Feb 29 - SPX 5100c Entry 0.30 - High after $5+ ($300 —> $5000 potential)
Feb 27 - TSLA 195p Entry 0.90 - High after $2.30+ ($900 —> $2300 potential)
Feb 26 - SPX 5070p Entry 0.20 - High after $2. ($200 —> $2000 potential)
Feb 23 - NVDA 800p Entry 2.50 - High after $25.11 ($3000 → $25110 potential)
**Dipped to 2.57 (had to chase entry 3)
Feb 23 - NVDA 820c Entry 2.25 (swing from Thursday) - High after $25.00 ($2250 → $25000 potential)
Feb 22 - SPX 4090c Entry $2.50 - High after $9.20 ($2500 → $9200 potential)
Feb 16 - SMCI 1000p Entry $11 - High after $195 ($1100 → $19500 potential)
Feb 15 - TSLA 195c. Entry $1.20 - High after 5.95 ($1200 → $5950 potential)
Feb 14 - NVDA 720p. Entry $4.5 - High after $12 ($4500 → $12000 potential)
Feb 13 - SPX 4955p. Entry $5 - High after $34 ($5000 → $34000 potential)
Feb 12 - ARM 180c. Entry $1.20 - High after $14.10 ($1200 → $14000 potential)
Feb08 - ARM 100c. Entry $5 - High after $27.50. ($5000 → $27500 potential)
Feb07 - TSLA 185c. Entry $2.53 - Hight after $5.60 ($2530 —> $5600 potential)
Feb05 - SPX 4940c. Entry $3 - High after $16.60 ($3000 → $16,600 potential)
Feb02 - AMD 180c. Entry 0.15 - High after $1 ($1500 —> $10000 potential)
Jan 29 - SPX 4910c. Entry $1 - High after $20 ($1000 —> $20000 potential)
Jan 26 - NFLX 570c. Entry $0.50 - High after $9.85 ($500 → $9850 potential)
Jan 25 - TSLA 185p. Entry $1.5 - High after $6.3 ($1500 → $6300 potential)
Jan 24 - SPX 4890p Entry $1.50 - High after $22 ($1500 → $22000 potential)
Jan 24 - SPX 4880p Entry $0.50 - High after $12 ($500 → $6000 potential)
Jan 17 - SPX 4740c Entry $0.20 - High after $2.80 ($200→ $2800 potential)
Jan 17 - SPX 4740c Entry $1.20 - High after $12 ($1200→ $12000 potential)
**Past Performance is not indicative of future results
For live alerts and market commentary click the button below.
Monday’s Price Action (Education)
You don't try to make $100,000 ...You don’t start by saying, I’m going to make the biggest most profitable trade and turn $1000 into $100,000 and fix all my bad trades before.
You say, I’m going to plan and execute 1 trade as perfectly as I can today. You do that every single day, and soon you'll have a $100,000 and likely much more!
SPY/SPX
Yesterday I wrote
And we got a push into 514.80 and a rejection to position short. I also wrote a warning that I didn’t want to go long without a minimum 2 pt dip. You can see where the 2 pt dip from day high acted as support but kept rejecting on vwap — that action implies don’t go long. If you do go long, be sure to lock a bunch in at vwap until vwap turns into support a short squeeze develops.
Trading SPY was a bit more tricky because the contracts were juiced in monring and there was a bunch of chop.
As you can see push over 514.80 but after the first hour, 514.80 broke and was never reclaimed.
TSLA
I missed the long on this. I was looking for a dip into 165 target 172.50 to 175.5 area. After establishing support at 160 and moving to oversold condition, a small positive news trigger is all that was needed to trigger a rally.
If I paid more attention, I could have started a long after seeing 166 make a higher low and a push over 167.50 and VWAP.
With this pattern, and using 172.50-175 as the target, I would take TSLA 172.50c. Entry would be around 2.40 reaching 5.50
Let’s talk about what took my attention away
GOOGL
On news of a possible deal between AAPL and GOOGL, the stock rallied hard. Given weak market conditions, and that this is an unconfirmed deal, my bias was heavily short and there is. a large gap to fill. I estimated a push into 152 would give us the short, and that is exactly what we got. I normally don’t ignore my stop and added to the position once I saw the turn confirmed for a great payout.
Because it is a Monday, I choose an option contract at my minimum move expected. In this case it was 146.80 and 145 as high probable prices to come with 141-142 for gap fill. So for $0.10-0.20 risk I have a potential for $1 to $2 high probable gain and possibly as much $5-6.
All targets for this plan were met yesterday. I also chose to swing runners overnight.
PLEAE REVIEW THE RISK/REWARD. I want to take that bet all day long.
Another big reason for the focus on this trade is that it aligns with one of my trade setups that has an 88% win rate. Gap up reversals on BS news.
SMCI
I was ill prepared for this move. I saw the large gap up on open and push to 1145 and my mind was screaming go short but I was focused on GOOGL.
I then saw 1090 break and while very risky it felt like its dumb not to take this trade!
I exited most around 20 since I had too much size on it.
I got stopped out around 20 on runners, but later in the day another opportunity came to get 800p for $5 as yolo swing.
This morning we are gapping down under 900!
So why the short in SMCI?
Many times once a stock is included into an index there is selling since the catalyst for buying is gone. Then technically we had a rejection of the 1145 level and a break of premarket support at 1100. We should then at minimum drop to previous major support at 980-1000. Which we did giving us a 100% gain. Finally with 980 being broken that showed that there were any bids there and while SMCI was able to bounce back to 1000 it wasn’t able to get to vwap. these are all ingredients for a downside recipe.
Summary Review of Market Price Action
Yesterday’s price action leads me to believe it was a low volume relief bounce and more downside is coming with FOMC as possible trigger for a corrective leg. We still have to be careful since, every 12-15 point dip from highs has been met with strong buying.
Educational Lessons
From the price action review you should have learned the following:
Wait for the levels to plan trades
How to target which contracts on a Monday
Be patient. Let trades come to you. Make it OK to take only 1 trade a day.
Use /plan in Edge Trade Planner to quickly create trade plans.
Learn how to recognize failed breakdown reversals at key levels.
Trade Ideas - Plan for Tuesday Mar 18
Stick to process. The process and trade setups I teach works. Rinse and repeat over and over again. There will be losses. Any good system will have them. Being systematic also means the gains will repeat and come again too. If you keep changing your system/process trying in an effort to never lose a trade, you will never get to where you want to go.
Market is gapping down so I’ll be looking for a little BTFD of Friday’s levels and then look to go short. The big question in my mind is does market sell off ahead of FOMC or does it chop around today with a tug of war fight between bulls and bears
I’m watching the following today: SPY, TSLA, NVDA, SMCI, GOOGL
I’m having power and internet problems so can’t update the levels or give bull bear triggers today.