$SPY

Institutional accumulation @ $389.95-$395.88, $421.80, & $441.84

Very significant candle formation this past month…

Current trend / price-momentum favors upside.
$464.84 is the next major resistance.

$441.84 is key to be held or momentum could potentially shift.

So we know that institutions are accumulating the $SPY
This is very obvious and I have been talking about it for months.

However, we can also clearly see that price is in somewhat of a box.
When the market is being accumulated, it is typically accompanied by sideways price movement until a Test of Supply is ran and passed…

A test of supply is what institutions do to ensure that they have absorbed all the retail sell pressure in the market, and they can now easily mark prices higher and ignite a prolonged bull-run.
They do not want to push price out of the accumulation range if they are going to be met by retail sell-pressure rather than willful buyers.

They test supply by pushing price into an area of previous sell pressure ($440-$450) where they then drop bad news…
Fitch US Debt downgrade in our situation.
This sparks retail panic.
If high volume selling returns to the market, then it has failed the test of supply and institutions will need to mark prices lower in order to accumulate more.
If volume remains low, then that means the last of the retail sell pressure has been absorbed and the market is ready to move aggressively higher.

August’s candle looks like a textbook Test of Supply candle pattern…

Did the market pass?
Is price about to break range and enter a prolonged bull market?

Or did we fail?
Is price going to fall downwards and be accumulated more?

A passed test of supply is supposed to leave the following;

Small candle body- Check
Large lower wick- Check
Low volume- Check?

While the candle’s volume is below average, it is increasing relative to the previous candle. This does make me question the pattern a bit.

I want to say that there’s no doubt we passed and price is ready to launch
I’d also love to say there’s no doubt we clearly failed and price needs to go lower…
The reality is this is a probabilistic pattern and nothing is for sure…

I’m not here to be a prophet, I’m here to make a profit, and if I’m being honest I do see the argument for and against this being a passed test of supply.

We know institutions are still actively accumulating at these prices.
The weekly chart the past few weeks showed constant stopping pressure and accumulation- which I wrote about multiple times.

It was no surprise that price reversed and erased most of the sell-off by months end.

Let’s talk about THIS week’s candle. Any signal?
Not really.
It’s the lowest volume in 7 weeks.
Not typically a candle I open new positions from.

I don’t see it as a bearish anomaly because volume priced this in for the last 4 weeks. This move didn’t necessarily need to be backed by volume because the volume supplying this move occurred beforehand.

Here’s an example of a successful test of supply that ignited last weeks rally. I went in heavy detail how this daily chart was bullish and being accumulated in a newsletter a few weeks back, https://twitter.com/AllllSevens/status/1690849811203784704?s=20
The Test of Supply candle pattern was a perfect long entry.
It is possible we’re seeing this same pattern about to play out on a monthly time frame…

Unusual Options Flow
An absolutely insane full risk bullish order that makes me want to slam the table on longs…

Conclusion-
I am pretty positive that the SPY has just passed a Test of Supply and the bull market is ready to begin…
My first target is $464.84

At the same time, I do see the potential for this to be a failed test and I have a plan.

If price closes below $441.84, my longs will immediately be stopped and I'll need to reevaluate the situation to potentially go short targeting 8/18 lows and potentially lower. If this scenario happens, I will update on twitter and again in next weeks newsletter!

$AMZN

Institutional accumulation @ $85.82-$87.86

The sentiment behind this dark pool transaction is unknown-
It could be a massive buy, or it could be a massive sell.

All I know is the $125-$130 area is a price level of extremely concentrated institutional volume so it should act as a strong support/resistance in the future, potentially for institutions to accumulate more shares from. Only time can tell.

Bulls holding momentum on this break over $130 so far.

Unusual Options Flow

Conclusion-
Institutional money is in for the long-term.
Notably at levels much lower.

I’m currently looking for potential for short-term continuation into November expirations as long as $125-$130 is held.

$INTC

Institutional accumulation @ $38.73-$29.97 & $48.28-$49.20

Upside reversal pattern.

Unusual Options Flow

Conclusion-
Institutional money is in for the long-term.

Short-term we are seeing potential for this 6 month candle to continue expanding towards the high $40’s

$ARKK

Clear stopping volume / accumulation patterns on the $75.93 sell-off.

Institutional accumulation @ $35.11-$36.98 & $109.71

Unusual Options Flow

Conclusion-
It’s very clear institutional money is positioned for long-term upside.
I would like to do the same.
Buying shares I’d be willing to hold for 10+ years is my current plan.

Price is currently stuck in a base, forming higher lows over the past few months, unable to break to the upside.
Over $51.54 range opens up big-time.

For me to get aggressive with short-term adds and/or call options I want to see that breakout and/or a an A+ weekly or monthly candle for entry.
Unfortunately right now I am not seeing that.
I will update when I do!

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