ATE is Back! Trading SPY & IWM
A Trader's Education is back and primed with fresh trades in familiar tickers.
Hello traders! I hope you have been well and enjoying trading over the past six months. There has been no shortage of opportunities.
Before we get into the charts and trade ideas, which we will definitely get to, it is my pleasure to announce that ATE is back!
Publishing weekly, and full of the same great trading education and trade ideas that you have come to expect from A Trader’s Education, I am excited to be able to pick up right where we left off.
It has also been great to see new subscribers joining even while the publication was paused. ATE now boasts over 1,700 subscribers and continues to grow every week.
I appreciate every one of you. Thank you so much for making this newsletter possible!
For those that have upgraded (only $8 per month) you will start receiving trade ideas, complete with entry and exit points, stop loss levels, and which options contracts I’m considering beginning November 1st.
I’ve got an example with a IWM trade I’m considering this week. More on that later.
If you haven’t upgraded yet, you can use this link which will give you options to pay monthly or annually (slight discount).
And now let’s get to the charts!
First up, a look at what we might expect next week for the broader market with the 1-hour candles for SPY. It is recovery or fade time.
Huge names report this week - GOOGL, META, AMD, MSFT, AMZN, XOM and so many more. Keep this in mind when entering and exiting trades.
I like to exit and take profits (or a loss if needed) before earnings are reported. There is no better feeling than locking in a win and no worse than watching it turn to a loss.
That said, if I have already made a decent profit I might leave a few contracts open through earnings if I think there is a chance for a big move.
Circling back to the chart, I am focused on 579-580 as the key support/resistance zone to watch.
After holding two weeks ago, support was broken last Wednesday and now shares are attempting to regain momentum.
Higher lows formed, but Friday closed below the trendline which was also below the 579-580 zone.
On a clean break above 580 to start the week, I like the 585 strike call options expiring Nov 1st for a very quick trade. Tight stop loss at 580.
IWM
Notes:
The candles for IWM are on an accelerated path higher, breaking away from the prior uptrend in September.
Trading for upside, if shares break above 220 I like the potential for a move all the way to 228 and possibly higher.
Big earnings week ahead could be another catalyst to move the broader market higher.
Action:
Bulls are looking for a breakthrough and retest of 220 for an optimal entry, but could also enter the trade on a powerful break through 220 and not wait for a retest.
Bears are looking for the trend to break, focused on 218 as a key support level.
Targets:
Upside targets are 221.97, 222.74, 225.21, 228.00
Downside targets are 215.65, 214.60, 212.00
Execution:
Breakout Trade -
Considering buying the Nov 8th, 225.00 strike call options on a breakthrough and retest of 220, entering on a bounce off of this level.
Stop loss at 218.50 or 50% loss on the options contract.
Breakout Trade -
Or considering buying the Nov 8th, 24.00 strike put options on a drop below 218, entering on a retest and reversal off of this level.
Stop loss at 219.50 or 50% loss on the options contract.
A few other tickers that have my interest are CPNG (bull flag), ET (consolidation breakout), and DKNG (finding support?).
If you like the format above (Notes, Action, Targets, Execution or N.A.T.E. - see what I did there?) you might want to consider the upgrade for only $8 per month.
Let me know what tickers interest you, if there are any charts you are watching, or if you have any questions.
I appreciate all of you. Thanks again for subscribing to A Trader’s Education.
Have a great week of trading ahead!
-Nate
This service is for general informational and educational purposes only and is not intended to constitute legal, tax, accounting or investment advice. These are my opinions and observations only. I am not a financial advisor.