It looks like SPY held support at 547 and saw increased buying in the second half of the day. Interestingly, MFI remains right around 50, so it’s possible that this bounce is short-lived (see July 31).

Volatility

The VIX broke down below 19 for the first time in a week. If fear continues dropping, SPY can head toward all-time highs. This is actually my preferred scenario because it gives more short accumulation opportunities. Since this can quickly turn into a momentum move, I’m going to let the dust settle before adding any more.

Spy resistance levels

Right now, SPY sits at resistance at 554.42. If we open above or break through tomorrow, the next resistance is at 562-565 (all-time highs). There are no technical resistance levels above there, so it’s important to remain level-headed and not revenge trade.

Presidential debate and future market growth

While the debate last night might have had some effect, I don’t it to remain around too long. The market is in dire need of price discovery after being up over 30% since November 2023. I am confident in shorting, but timing is essential.

My plan for tomorrow

If buying continues, I’ll let it start to slow before adding anything else. If the resistance at 555 or 562 puts up a fight, I will likely add more there. I’m also shorting NVDA, regional banks, and adding long shares to my position in DVN.