WEEKLY GAME PLAN January 08, 2022

Welcome to the Weekly Game Plan! The 'MARA Lists' are updated in real-time. The 'Market Summary' is provided weekly. The 'Deep Dive Video' is the recording of our weekly Trading Prep DEEP DIVE.

Market Summary


The summary below is my interpretation of the data in the ‘Market Mood Log’ above:

There were a few major points that jumped out at me when assessing this week’s ‘market mood’ including an extreme dry up in the universe list (359 last week to 300 this week), topping action and hard sell offs in a number of stocks across sectors, and whipsawing action on the major indexes. The market is in the ‘chop zone’ right now. While the indexes have been whipping back and forth, until major support is broken, this chop is likely to continue. Good for short term and day trading, harder on swing and intermediate styles.

  • Whipsaw on the indexes: Each of the indexes across weekly and daily time frames experienced whipsawing action this week and were caught between levels of intermediate term support / resistance. The price action has gotten wide and loose as these levels have been tested.
  • More New Lows are being made than new highs: the market cannot produce a sustainable, constructive rally, until this is rectified. It’s been 2 months since the NASDAQ has had sustained triple digit new highs and low double digit new lows.
  • Distribution not a huge factor: You wouldn’t know it from the whipsawing action but there are only 2 distribution days in the last 2 weeks on the S&P 500. The sell off came on lower daily volume. This could be one of those things that ends up producing more of a reason for buyers to step in.
  • There are only 19 stocks total on the trade ideas list. That’s pretty light. When there isn’t much merchandise to choose from, its a sign that it’s not a great time to go shopping.
  • Open Trades: None as of this weekend.

HOW I’M PLAYING THIS HAND: There’s 1 long and 1 short that look attractive and I’m placing order for. I’m looking to short BUG via 30 Feb 18 puts. I’m looking to go long DOV. Both will be small positions risking 0.25% capital each. With such small positions and in a choppy environment, I’m often asked ‘why bother putting on positions at all? what not sit it out altogether?’ It’s a fair question and my answer is two fold.

  1. Putting on trades in setups I like helps me keep my finger on the pulse of the market.
  2. If the trades work out, I’m able to build on success and do not feel flat footed. I can also recycle those gains to finance risk.

Checkout the charts of the indexes below.

MONTHLY CHARTS (indexes) Over all Direction = Sideways: https://www.tradingview.com/x/zRIpp14z/

WEEKLY CHARTS (indexes) Over all Direction = sideways: https://www.tradingview.com/x/8s67XpDB/

DAILY CHARTS (indexes) Over all Direction = Down: https://www.tradingview.com/x/waAruCCt/
(on the lower right is FFTY, the ETF that tracks the IBD 50)



Elite Members go to Elite Training for this week’s topic Basic Candle Stick Patterns (Stu).


Trade Ideas, setups for the week ahead and group discussion (Mike)

DISCLAIMER: Futures, stocks, and options trading involves a substantial risk of loss and is not suitable for every investor. The valuation of futures, stocks, and options may fluctuate, and, as a result, clients may lose more than their original investment. The impact of seasonal and geopolitical events is already factored into market prices. The highly leveraged nature of futures trading means that small market movements will have a great impact on your trading account and this can work against you, leading to large losses, or can work for you, leading to large gains.
If the market moves against you, you may sustain a total loss greater than the amount you deposited into your account. You are responsible for all the risks and financial resources you use and for the chosen trading system. You should not engage in trading unless you fully understand the nature of the transactions you are entering into and the extent of your exposure to loss. If you do not fully understand these risks you must seek independent advice from your financial advisor.
All trading strategies are used at your own risk.
Any content on marawealth.com should not be relied upon as advice or construed as providing recommendations of any kind. It is your responsibility to confirm and decide which trades to make. Trade only with risk capital; that is, trade with money that, if lost, will not adversely impact your lifestyle and your ability to meet your financial obligations. Past results are no indication of future performance. In no event should the content of this correspondence be construed as an express or implied promise or guarantee.
marawealth.com or Mara Wealth LLC. is not responsible for any losses incurred as a result of using any of our trading strategies. Loss-limiting strategies such as stop-loss orders may not be effective because market conditions or technological issues may make it impossible to execute such orders. Likewise, strategies using combinations of options and/or futures positions such as “spread” or “straddle” trades may be just as risky as simple long and short positions. Information provided in this correspondence is intended solely for informational purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted.