Market Breakout – Ride the Calls You Bought Last Week – More Upside
POSTED BY PETE STOLCERS ON OCTOBER 2
Posted 9:00 AM ET – Last Friday the market broke out to a new all-time high. Good economic news over the weekend is overshadowing the horrific shooting in Las Vegas. Stocks are poised to move higher ahead of earnings season.
My heart goes out to the victims in Las Vegas. Acts of terrorism have not sparked profit-taking and we won’t see much of a market reaction.
China released a strong PMI and readings reached a level not seen since 2012 (52 .4).
Global economic conditions suggest moderate growth and this will be a busy week of releases (ADP, ISM manufacturing, ISM services and the Unemployment Report). Good numbers will fuel the rally.
Earnings season was excellent and the guidance was very strong. We are two weeks out from major releases and the bid will grow.
Any hint of a tax deal will fuel the rally.
Last week I advised swing traders to buy calls. If you did that you are in great shape. Use QQQ $144 as a stop on a closing basis for tech stocks. For all other stocks use SPY $250 as your stop on a closing basis. We are moving our safety net higher to lock in profits.
Day traders need to be a little cautious on the open today. The market has had a tendency to test the downside early. When support is established – get long.
I’m expecting a gradual grind higher for the next two weeks.
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