All posts by Scott Redler
Scott Redler: What This Sell-Off Means
Brought to You By Power Plays On July 24, Scott Redler appeared on Fox Business with Liz Claman and JP Morgan’s Phil Camporeale to discuss the market environment: Watch the latest video at foxbusiness.com Scott goes over: How he predicted the semi top on June 20 Why you can’t ignore a leading sector breaking down Why Scott expects a more tactical environment How to succeed in an environment like this Why we could hit new summer lows Whether it’s time to chase the regional bank stocks Why he doesn’t think the Fed is cutting rates next week What it will take for the Fed to cut Don’t forget to check out Power Plays. Positions Disclosure as of 2024-07-25 at 7.29.04 AM
Continue Reading -->IWM Case Study: How the Red Dog Reversal Works, Long and Short
Brought to You By Power Plays The Red Dog Reversal (RDR) is a trading technique I use to catch countertrend moves in an oversold or overbought stock. It’s been one of my bread-and-butter strategies for years. And my community just had the chance to use it both long and short with IWM — within the span of a few days. As many traders know, IWM recently went on a tear when small caps look over leadership from large-cap tech. But IWM has been quite volatile, allowing us to play it from both sides. And today I’ll show you how you could have spotted a nice shorting/selling opportunity — followed by a long. First, we’ll go over the Red Dog Reversal Sell Rules . Here are the 4 steps to a Red Dog Reversal Sell: Stock is up for multiple days Stock goes above prior day’s high Stock trades back below through prior day’s high, which is where the sell/short triggers The stop is set at the current intraday high Here’s how it played out with IWM: IWM rose for 5 days in a row into 7/16 On 7/16, hit a high of $224.86 On 7/17, IWM went above $224.86 and then below for a sell/short at that level Stop is set at the new 7/17 high of $226.84 Since the short entry is $224.86 with a $226.84 stop, we are looking at risk of $1.78 per share. And on Monday July 22, IWM hit a low of $215.38. (more on this important level below) I was happy about the decline 0ff the highs because I was short the IWM ETF plus IWM calls. Those positions were getting hairy when IWM was ripping, but it resulted in a nice profit. And on Friday, July 19 — I flipped it around. I went home long IWM calls and short IWM puts (shorting puts benefits from rising prices) — just in time for Monday’s rebound. Incidentally, that $215.38 level mentioned above was a Red Dog Reversal buy. Here are the Rules for a Red Dog Reversal Buy: Stock is down for multiple days Stock goes below prior day’s low Stock trades back up through prior day’s low, which triggers the entry The stop is set at the current intraday low Here is how it played out on the chart: IWM fell 3 days in a row through 7/19 On 7/19, IWM hit a low of $215.85 On 7/19, IWM broke below $215.85 and reclaimed it to trigger long Stop is set at the new 7/22 low of $215.38 With a long entry at $215.85 and a stop at $215.38, the trade would have risk of 47 cents per share. IWM soon hit $220+, which was an impressive move for trade with 47 cents of risk. While not every Red Dog Reversal trade works out, it’s certainly exciting when they do. And in this case, it showed how effective it can be both long and short when you are opportunistic. Positions Disclosure as of 2024-07-22 at 3.25.55 PM
Continue Reading -->ARM is the semi to watch today
Brought to You By Power Plays SPX futures are +30 after a correction from 5669 down to 5497 last week. If the bears want to keep active control, they probably need to reject price this week into the 5560-5585 area. Not all sectors are created equal as the money rotates every few weeks. Now let’s dig into some individual names: ARM is a stronger semi so see how it reacts today. We’ll see if it gets and stays above $166 to see $171ish. AMZN stopped out most remaining active longs when it failed to hold the $197.60 area. Record Prime results were sold and it hit a low of $180.11 before reclaiming $181.45 on Friday. I’d think $186-$188 gets rejected if this tries to bounce pre-earnings. PLTR acted well when most names didn’t. It hit a high of $29.83. I’m still long some, and it needs to hold $27.80. GOOGL reports tomorrow after the close. It looks similar to NFLX as it pulled in off the highs but it’s not worth an options play yet. GOOGL’s recent high is $191ish. The reaction will be important for how we approach these types of names. TSLA also reports tomorrow. It hit a high of $271 and a low of $233 in the last few sessions after a nice move from $191-$198. It’s hard to tell what’s next as it wedges. $245 is active support, then $233. If this pushes, $258 is active resistance. It’s flattish this morning. Featured: Join Scott Redler’s Plays for $99 Get Scott’s #1 idea each week. That’s 52 weeks for just $99. (not a typo) Recent ideas include Rivian (RIVN) and XBI. You can be on the list for the next one: See why now’s the right time to join. Your Tip for This Week: Keep an Even Keel I don’t know what’s worse: having too much confidence or not enough. So don’t go overboard celebrating your trading wins. We want winning to be a normal day at the office — not special occasions that are so rare they’re worth celebrating! And don’t go overboard crying over your losses, because underconfidence will prevent you from executing on good trades. You have to accept that losing is part of the game. Just make sure you lose small, and use those bad trades to figure out what you can improve for next time. If you learn from your losses, you’re at least getting something out of them. This Week’s Calendar Earnings season continues to heat up this week with GOOGL, TSLA, V, IBM, KLAC, and more! Plus we have the important PCE Price Index on Friday. Positions Disclosure as of 2024-07-22 at 8.31.20 AM
Continue Reading -->5 Trading Tips You Need to Know
Brought to You By Power Plays – Get Scott’s #1 Pick Every Week. In this classic webinar from the stone age (we mean 2019!), Scott Redler shares 5 of his most important trading tips. Remember, the tickers and headlines change, but the principles of success remain the same. So dig in and learn from these classic case studies, including Brexit, the 2016 US Presidential election, the so-called Death of Facebook, and more! You’ll find out: What pro traders do different What Bruce Lee can teach you about trading How listening to exciting headlines is hurting you Why trying to make a big market call is a mistake The reason it’s time to treat trading like a business instead of an expensive hobby Why patience and discipline actually don’t exist, and what to focus on instead What’s kept Scott in the business after 20+ years P.S. Don’t forget to check out Power Plays – Get Scott’s #1 Pick Every Week. Scott Redler Positions Disclosure as of 2024-07-17 at 1.24.06 PM
Continue Reading -->Is THIS the New Nvidia?
Brought to You By Power Plays SPX futures are +20. Last week’s high is 5655. We’ll see if today’s gains build. Odds of a 9/18 rate cut are 95%, and the market is pricing in 64BP worth of reductions for 2024. Dovish developments are driving the tape with small caps, bios, and beaten down sectors moving. We’ll measure how this develops as we approach the tape this summer. Now let’s dig into some individual names: AVGO is post-split this morning. $185 calls may work. Because if AVGO follows in NVDA’s footsteps, there could be a big move here. But know your risk. SMCI needed another week to move. I mentioned it was a candidate to be added to the NASDAQ 100. We’ll see if early gains hold and build. Holding $930-$934 keeps it ready to attack $972, then $1014, and eventually higher. LLY gave many ways for active traders to buy swing longs. If you’re an investor, maybe it changed your life. It’s above the $950 high to manage. The 8/21 day has been buyable since it broke out over $800. I think a split is coming. RDDT is choppy. But a strong move above $76-$77 should get this to $90ish in time. AMD gave a great move from $166ish to $187+. Now we see if it holds $177ish to give another bull flag move above. Featured: Join Scott Redler’s Plays for $99 Get Scott’s #1 idea each week. That’s 52 weeks for just $99. (not a typo) Recent ideas include Rivian (RIVN) and XBI. You can be on the list for the next one: See why now’s the right time to join. Your Tip for This Week: When Things Go Wrong, Get Small Trading is a lot like poker. You can prepare and study for years to get an edge over the house. But sometimes, you just get dealt a bad hand, and there’s nothing you can do abou it. We all find ourselves on losing streaks from time to time. What matters is how we pick ourselves up. If you’re in a rut, trade smaller and focus on just getting profitable again. This way, you can rebuild your confidence without digging an even bigger hole. One thing you must never do is up your bets after you’re down. That’s how you go from 5% down to 20% down to 50% down. This Week’s Calendar Earnings season heats up as more banks report. Plus we have Netflix (NFLX) and Taiwan Semi (TSM) on Thursday, which could move tech. And plenty of Fed officials speak this week. Positions Disclosure as of 2024-07-15 at 7.56.04 AM
Continue Reading -->Can Tesla and Amazon Still Run Run Run?
Brought to You By Power Plays SPX futures are +3 after a big three-day move that held 5446 last week to hit 5570 on Friday (all-time high). Now we see if we hold 5520ish. We have CPI Thursday, PPI & bank earnings on Friday. And Powell speaks tomorrow. Now let’s dig into some individual names: TSLA was a big money trade for our community as we hyper-focused here to clear the $191 and $199 area. It hit $252 Friday. It’s down small this morning which is no surprise because it’s a little extended. I’d think $242ish holds. It should be in play for the rest of the year so keep it on the radar. AMZN gave a big money trade when it cleared the $189-$191 area to see $200ish. Some news about Jeff Bezos selling stock slowed it down. It can still see $205-$210. The first step towards that would be a high volume move over stay above $200.55. MSFT has been a great Power Plays name. It cleared key levels at $433 and $457 to hit a high of $468 on Friday to manage. There is no real setup now. NVDA finally woke up last Wednesday as it went through a “re-build” stage. Friday it was out of play. I’m long versus the $125 area. We’ll see if it can hold today and trade better. The next spot to clear would be $129ish. AMD chopped up traders for months then finally cleared $166-$167 with volume and authority Friday. It’s giving some upside follow-through this morning to trim. Chances are this works back to at least the $183 area. Featured: Join Scott Redler’s Plays for $99 Get Scott’s #1 idea each week. That’s 52 weeks for just $99. See why now’s the right time to join. Your Tip for This Week: Take a Blue Collar Mentality Every day is a fresh start. As traders, we must maximize the opportunities that are in front of us at the present moment. Forget about what happened yesterday, and don’t obsess over what may happen tomorrow. Let’s say you have a bad Friday. Don’t come in on Monday thinking you have to make up for it. You won’t be able to manage risk because you’ll be trading out of desperation. Even the best of us have rough stretches. But if we follow our principles and enter every day with a plan, our good days will outweigh the bad. Just take it one day at a time. On the flip side, if you make a fortune on Monday, don’t get lazy on Tuesday! Stick to your plan and make the most out of what you see. This Week’s Calendar There’s not much going on today. But the rest of the week will be busy with Powell Testifying, CPI, PPI, plus bank earnings Friday. Should be interesting with light summer volumes, which could create volatile action. Positions Disclosure as of 2024-07-08 at 10.14.59 AM
Continue Reading -->NVDA: $122.60 Is the Level to Watch
Brought to You By Power Plays SPX futures are +9 after big first-half gains of 14.5% with a high of 5523. What will Q3 bring? As active traders, we go day-by-day and week-by-week to figure out the flows. Will money rotate to energy and bios? Can semis and mega-cap tech keep their leadership? Will the Fed cut in September? Those are the questions we’ll let the market answer. This week, we’ll see if 5446 holds to keep this upper level intact. Remember we close at 1 pm Wednesday, and then we’re off Thursday for the July 4th holiday. A tech sell program hit late Friday. We’ll see if this repairs fast or if we see downside continuation below $478ish in the QQQ’s. $473 is key to the complexion of the week. Now let’s dig into some individual names: NVDA was $136+ when I said the semis were overheated. Last week’s low was $118, and it bounced to $128. But it still needs time to rebuild. I did take some home and we’ll see if new flows come in, or if it works lower in Q3. For today, it’s down a little. See if it reclaims $122.60 or stays below. I bought OXY for the re-balance trade around $59.50 and sold most into the $63.50 area. Seems like this can work higher. It needs to hold $61.50. AAPL: Friday’s last 5-minutes felt mechanical, so I did buy into the close. I trimmed some this morning. I’ll see if this candle repairs fast. Strength was sold almost every session. For now, use $210ish as key. A move and hold below can send this back towards the $206 area. TSLA finally had a big money trade. I loaded up on options and stock last week. It cleared $189-$191 and hit a high of $203+ Friday, where I took it off. Some rolled into $202 or $205 calls for this week. I wasn’t at my desk to reposition. I did manage half. Deliveries hit tomorrow. Know what you can handle. META is so sloppy. It got hit at the end of the day with tech. We’ll see if it can hold the $530 area. Otherwise, it’s an avoid. It needs to hold $490ish. Featured: Join Scott Redler’s Plays for $99 Get Scott’s #1 idea each week. That’s 52 weeks for just $99. See why now’s the right time to join. Your Tip for This Week: Take a Blue Collar Mentality Trading isn’t about turning on your screens and swinging for the fences each day. It’s about hitting singles and doubles. Success comes from showing up and doing the work every day, the same way carpenters, ironworkers, and plumbers put together a building. For traders, this includes forming an effective trading plan, observing the market, and aiming for consistent profits. I’ve seen a lot of traders search and search and search for some kind of secret sauce. Hard, steady work is the closest thing to it. This Week’s Calendar US markets close early on Wednesday and are shut all day Thursday for the July 4 holiday. However, we do have some important data points this week — especially the JOLTs Job Openings, ADP Employment and Nonfarm Payrolls numbers.
Continue Reading -->Scott Redler Shares His Next Favorite Pick on Fox Business
Scott went on Fox Business last week to share his thoughts on where there’s opportunity in this market. In January, Scott was on Fox Business explaining why Nvidia (NVDA) and Eli Lilly (LLY) were set to soar — as Liz Claman explains in the clip below (scroll down to watch). Nvidia’s up 161% since… Eli Lilly’s rocketed 52% YTD so far. He shares why the market could be rolling over starting July 1st. Your big names could slow down. Those that were bringing up the rear, could take the spotlight as the 3Q begins. With that rotation, Scott believes one famous tech name is set to take the lead over the Nvidia’s and Apple’s (AAPL) of the world. With Nvidia pulling back… Scott shares his approach on the semis, including: Why he called the semis overheated on June 20 Why laggards could start moving starting July 1st The #1 tech name for 3Q that Scott loves (note: it’s already taken off since this clip aired so be careful!) Check out the clip below: Watch the latest video at foxbusiness.com BONUS CLIP: Scott was also on Neil Cavuto’s Fox Business show recently too. Watch the latest video at foxbusiness.com For many traders, the market feels very ‘narrow’ right now. You have the S&P and Nasdaq making new highs… but sectors like energy are still sputtering. It feels like the opportunities are few. In this clip Scott goes over: How long this bull market may have left Scott’s call on a big tech name that’s doing well Scott’s ‘rebalancing’ trade for cashflow The unique options play that feels “out of nowhere” Want to see Scott’s trades BEFORE he shares them on TV? Scott’s Positions Disclosure as of 2024-06-26 at 2.12.05 PM
Continue Reading -->Scott Redler on NVDA: THIS Is the Key Area to Watch
Welcome to this week’s edition of Dog Bytes. To get this content by email every Monday, enter your email at the bottom of this page. We have mixed markets around the world as we head into the last week of the second quarter. Europe is green while Asia is off small. Last Thursday, I warned that the semiconductors were overheated, and that proved a great spot to sell some winners. Some sophisticated traders made money shorting SMH, NVDA, AVGO, etc. as well as buying SOXS. It feels like we have a tactical top in that sector as we see if money rotates into the rebalance from last week. SPX futures are +5. Last week’s low is 5452, with the 8-day under at 5440. Treasuries are flat across the board and Fed expectations are holding steady. Now let’s dig into some individual names: AMZN woke up last Thursday with a nice move through the $185 area. I bought a lot of $192.50 calls for July 5th. If this can hold $187ish now, it can clear the channel to hit $200+. It’s one of my favorite names now. TSLA has so many conflicting stories. It hasn’t been special since last December. The pattern is tight. I have some $192.50 calls for July 5th. This will need HUGE volume and hold above $189 to get some active momentum longs back here. $176 is key support. On Thursday, NVDA was a focus as usual, but to the short side for the first time this year. Some sold longs, some got short, some bought puts. Either way, my community was not buying. It was $140+ then, and on Friday, it hit a low of $124.30. I took some home long. I might need to wait until $118-$120 before looking to get aggressive. ADBE did fill some of its post-earnings gap but looks decent. It needs to hold $505, and if it clears $535, it probably accelerates for active cash flow. Your Trading Tip for This Week: Create a Daily Routine You Enjoy The number one thing traders waste time and energy doing is… figuring out how to use their time and energy. Create a daily routine that keeps you happy and productive. This includes everything from chart reviews to gym time to coffee breaks. There’s nothing less exciting than a schedule. But the more I plan out my day ahead of time, the easier it is to concentrate on the market. Plus, I have more energy for gym and family time, which is very important to me. Distractions kill your profits. So kill distractions with a routine! This Week’s Calendar Scott’s Positions Disclosure as of 2024-06-24 at 8.19.48 AM
Continue Reading -->Scott Redler Talks Tech Stocks on Fox Business
On June 20, Scott Redler appeared on ‘The Klaman Countdown’ on Fox Business: Watch the latest video at foxbusiness.com Scott went over: Why he was bullish on Nvidia (NVDA) and Eli Lilly (LLY) to start 2024 — and whether they can lead again Why he said the semiconductor trade was overheated Thursday The “8 times an hour” rule The role of today’s triple-witching expiration What could happen to the leaders and laggards over the next week Why Scott likes Amazon (AMZN), Apple (AAPL), and Meta (META) from here Scott’s Positions Disclosure as of 2024-06-21 at 6.46.42 AM
Continue Reading -->