5/2/2024 - Market Monday Post

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 Hi readers! This is the update for the weekly Market Monday and Strategy Sunday post! Yes, both posts are going to be combined into this post, so I hope you enjoy reading! Here is the update:



In the last Market Monday post, we saw that AMD was at its previous high, or supply-turned-demand zone. Based off of that, and AMD's continuous uptrend, I predicted that AMD would bounce off of that key zone and go up to create a new higher high point. AMD then proceeded to go in the complete opposite direction this week. Instead of going up, AMD stock actually broke the zone to the downside. It settled for about 2 days near the previous consolidation point, at the $166-$168 price range, then AMD stock actually came back above the zone it previously broke to the downside, which was around $174-$175. AMD hit $178, then sharply came back and touched the key zone of $174-$175, and then went back up to $178, creating a double bottom. AMD then came back down a little bit below the key zone, to around $172, and is now right at the key zone. The last candlestick was a huge green candlestick, with the top of the candlestick exactly touching my line that represents the key zone of $174-$175. Based on the past week's activity, I feel like AMD is consolidating or bouncing around a huge price range, but the range being huge is not a surprise as the previous consolidation was at a $15 price range. I think that AMD will go back up and touch its previous high point at around $184, and it can either break out of the consolidation or it can respect that point as a supply zone and come back down.


In the last Market Monday post, we saw that QQQ was at its trend line, and it was touching the trend line for the 3rd time. During the past week, QQQ went down, breaking the trend line, to the $418 to $420 zone. Then, it came back up to its previous high, the key supply zone at around $430. Then, QQQ went back down by about $5 a share, and then came back up and is currently at the key supply zone. This shows that QQQ is currently either going to break out of the consolidation, come back down and retest the $429 zone, and continue to go up, OR QQQ can just respect the supply zone and go down, which would form a Double Top trading pattern. This pattern normally also indicates that the stock will go, and if it is paired with a key supply zone that was respected twice before, it certainly foreshadows a downward move. So, for QQQ, I would predict a downward move. I think that QQQ is currently settling down for consolidation, as this consolidation is similar to the previous patterns of consolidation QQQ has shown on the charts. Another key thing to keep in mind is that the previous trend line is not a reliable indicator of QQQ's movement anymore, as QQQ has heavily broken the trend line in the past week. This essentially renders the trend line less useful overall. 


Also, I have a small adjustment to make to the upload schedule for this blog. I will be combining the Market Monday and Trade Talk Thursday posts and be posting that on either Thursday or Friday. This allows me to make more of a connection between what happens to the stocks and the results of that on my options position, and I can analyze that more in these posts. This will result in more insightful posts for the readers! I will just cover where the stocks went, where I see them going in the next week, updates on my options position, and most importantly, what happened every day to my options position as a result of the daily moves in the underlying stocks.


Over the weekends, I will be posting the Strategy Saturday/Sunday posts. There will be no changes in this part of the upload schedule, I will continue to teach the readers more about options in these posts. However, I will be making a small change: The Strategy Saturday/Sunday posts will alternate between me discussing options concepts (for those unfamiliar with trading) and me talking about and sharing some lessons I learnt from my options trading. This will give the readers more insight into real time trading, beyond just technical details and concepts.

I hope you learnt something from this post, and thank you for reading! I will see you in the next post!


Here are the pictures of the AMD and QQQ charts:





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