SPY just did 200 pts in 5 days. Does the rally continue Friday Nov 3?

Short blog today…

Let’s review yesterday’s price action. SPY 0.00%↑ did a gap and go move along holding the opening support level and not filling the gap at all. It effectively pushed to the 431 level I predicted a couple of days ago on if a strong bull move comes. It got here faster and without any back test. This leads me to believe it a monster squeeze.

There were only 2 dips that lasted all of about 15minutes each. Very strong buying. 431-432 is the key level to imho to determine if we will be having a Christmas rally.

Until I see a backtest of support to confirm the bids, I’m hesitant to declare bulls are back in control.

Effectively the overall swing idea has played out. Can we go higher ? Yes. Can we yank again. Yes. Keep reading for my plan.

I’m a big believer of sequences and think SPY like to move in waves or 3 or 5 green days at a time. yesterday was day 4. Friday may give day 5, but given the range and speed, I will be prepared for a short.

Given the gap up and limited range, the scanner had its worst performance since I started tracking. (this does not include alerts for swings. just same day trades)

I was able to take 2 short trades for 3R barely follow THT system and rules. After that I just didn’t like the trade setups. Learning to be patient and not over trading is key.

Based on the price action and the alerts, it really looked like traders focused on premium selling vs directional buying in SPX. I’m still working on the logic but hope to introduce a flag to indicate potential premium selling action in the scanner alert.

My Plan for Friday Nov 3

I’ll be watching for reaction to jobs report. overall SPY looks like it may push 432 to 434 and I will look for a short scalp there.

I’ll be taking it easy after a solid week from swing trades. Overall I will look for a failed gap up reversal if we gap up again today and if we dip on open and hold will look to join trend.

For now market hasn’t given a reason to go short so watching dips for a long until a support is broken.