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Traderade Ideas: All Eyes on 4200

Updated: May 29, 2023

Battle lines have been drawn at 4200 on the S&P 500 cash index. We can see there is significant call positioning at that level, but also that call open interest is much higher now at 4300 than it was recently. Meaning the 'wall of calls' has moved higher. This is potentially bullish as it moves the most options-induced significant resistance higher.

We still need to see the momentum, though. Without a decisive close above SPX 4200 (just a handful of points above at 4205.45), we are still in an area where it's worth watching how we trade into next week. Continuation from where we are now on Tuesday would have me more interested in bullish momentum trades in US equities.

On the other hand, if we see the upper band of this trading range get faded again, I would look towards bearish momentum trades.

Because of that, I've prepared two lists of potential trading opportunities that fit each category. This is a different approach than what I've done recently, where I've focused on a smaller set of ideas or just a single name. But it's also a way of optimizing the set of possibilities to ensure that there may be something for everyone that wants to add some new stocks to their watchlists.

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