Stocks May Be Getting Ready For A Massive Surge Higher

It continues to be the wild west of trading with a market that is screaming to go higher. It appears signs are forming that the market is pretty close to racing back to the highs seen last week.  The big move higher following this morning steep sell-off would suggest that higher prices may be in the works. I got into a lot of detail today, also noting some options trades in some key ETF’s that indicate the market may be ready to go higher. Signs Of A Market Bottom Are Forming

S&P 500 (SPY)

The S&P 500 sold-off sharply to start August 7, and quickly retested Monday’s lows of 2825. It had seemed the sellers were in control, but by mid-day, that had changed. The S&P 500 managed to hold support at 2,825, creating what now appears to be a bullish reversal pattern known as a double bottom.

To be sure, we still need to see the S&P 500 rise above December uptrend. That would open a gap fill up to 2,915.

China (FXI)

Another reason I am feeling more bullish on August 7 is after looking through the ETF flows in the options market. What I found interesting is that many put contracts for expiration in August were closed out for the FXI. It would suggest to me that some traders do not see additional downside risk to the China ETF anymore. I discussed these trades in the video mentioned above.

Additionally, the FXI has found a meaningful level of support at $38. I explained this in greater detail in my premium video today.

FXI

FXI

VIX

The VIX has also taken a significant turn lower and appears to be heading back towards 17. Again, in the video mentioned above, I talked about this too.

VIX

VIX

Amazon (AMZNWealth Strength IndexAAPL is Extremely Up and trending Up)

Moving on, Amazon continues to challenge resistance at $1,800. I continue to think that the stock is likely to trend higher towards $1850.

Amazon, amzn

Amazon, amzn

ROKU (ROKU)

Roku is surging after hours, and I threw my hands up in defeat. I can’t figure this stock out anymore. I have lost my way when it comes to Roku. The numbers look solid across the board. We will see what happens tomorrow when regular trading resumes. Right now resistance is around $110.  That pattern is still bearish. Not to through cold water on the bulls celebrating, if the stock can’t get above $110 to $112 tomorrow, I’d be worried.

We’ll see…

roku, roku

roku, roku

Disney (DIS)

Anyway moving on, Disney did fall sharply today, but again this isn’t a quarter by quarter story at the moment. DIS is a 2020 streaming service story. Support at $132 appears very strong, and so I think this will continue to work its way higher back towards $140.

disney, dis

disney, dis

Tesla (TSLAWealth Strength IndexAAPL is Extremely Up and trending Up)

Tesla has found some strong support at $225, and so I continue to TSLAWealth Strength IndexAAPL is Extremely Up and trending Up believe it works its way higher towards $253.

tesla, tsla Stocks saw a massive intraday rebound on August 7 and are setting up for a big move higher in the coming sessions.

tesla, tsla Stocks saw a massive intraday rebound on August 7 and are setting up for a big move higher in the coming sessions.

PayPal (PYPLWealth Strength IndexAAPL is Extremely Up and trending Up)

PayPal has found some reliable support around $101.50, and it appears that it could work its way higher towards $109.50

paypal, pypl Stocks saw a massive intraday rebound on August 7 and are setting up for a big move higher in the coming sessions.

paypal, pypl Stocks saw a massive intraday rebound on August 7 and are setting up for a big move higher in the coming sessions.

Anyway, let’s see how tomorrow goes.

-Mike

This article first appeared on Mott Capital.

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