ATM Trading Club Newsletter

Wednesday, June 12, 2024

Breaking News! CPI and FOMC Event Rocks the Market! SPX Opens with a Spectacular Gap at 5409.13, Rallies to New Highs, and Awaits Powell's Crucial 2:30 PM Speech, Closing Triumphantly at 5421.03!

Market Recap: The market was buzzing today with anticipation as the CPI and FOMC events unfolded. The SPX opened with an impressive gap at 5409.13, setting the tone for a highly volatile session. Traders and investors alike watched closely as the index rallied towards new highs, all eyes on the crucial FOMC press conference at 2:30 PM. Fed Chair Powell's remarks were pivotal, leading to significant market movements and a strong close at 5421.03. The day's action highlights the market's sensitivity to economic indicators and central bank guidance, setting the stage for what could be a transformative week ahead.

Thursday kicks off with the PPI report in the morning. Additionally, AVGO’s announcement of a 10-1 split and strong earnings is set to propel the SPX upwards at the opening bell. Currently, resistance levels are defined by the breach of the Bollinger Bands, which sit at 5398.88. As we navigate these uncharted territories, there is no historical data to indicate past resistance at these levels, making it an exciting and unpredictable market landscape. Stay tuned and prepare for potential volatility as we assess market reactions to these key events.

### Levels to Consider for Thursday:

- Resistance Levels:

- 5450 on the high side

- 5475 on the extreme high side

- Support Levels:

- 5398.88

- 5314.47

### 0DTE Plays to Consider for Thursday:

- Gap Up:

- If the MACD shows negative divergence and the VIX is elevated, consider a Call Credit Spread (CCS). Place the strikes about 10 points above the high of the morning.

- Gap Down:

- Look for a Put Vertical Spread if price holds support at 5400. For an aggressive play, consider the 5400/5395 strikes. For an extreme downside move, consider the 5375/5370 strikes.

Charts….