The Big 3: VRT, SOXL, MA

Welcome back to Trading 360. I'm Marley Kaden. It's time for the big three. We've got three stocks, three charts, and three trades for you. Rick Dat will be taking us through the charts. Here to take us through the trades is Scott Bower, the CEO of Prosper Trading Academy. Great to have you both on. Scott would love to start uh with a big picture thought on the market coming into the the week many people have been waiting for here with Nvidia coming our way. some other big names that aren't quite getting as much press because of Nvidia, Jackson Hole at the end of the week. How are you looking at the market as we come into this week? >> Yeah, it seems like uh everyone's kind of a bit cautious and and I'm not so sure it's even Nvidia to be quite honest with you and more about where the 30-year interest rates are and what Kevin Wars is going to say at Jackson Hole. I think from a a more macro perspective, that's what you know kind of this little fear that might be in the uh in the market we're seeing is. >> All right. So then let's dive into the big three here. You've got Verdive as your first pick here. They are moving down quite a bit today uh much more than the broader market. We're down almost 4% right now. How are you looking at Verdive? >> Sure. I think this one can can definitely move on Nvidia earnings. So maybe there's a little bit more risk here, but there is major support right at the 200 day moving average, which is where we're trading right in that, you know, 250 251 area. So it's kind of a proxy for Nvidia because it is going to move on those earnings. So I am bullish here technically based off that 200 day moving average. And I'm going to buy a pretty wide call spread. This week's expiring really quick 265 285 call spread looking to pay about $2 or so if possible. And again, I think th this is one we hold through Nvidia earnings and it's going to be a a big move up or it's going to be a bust. But with every trade that I put on, I know my risk going in and my risk is what I pay for this spread. >> All right, Rick. So, as we as we look at Verdive and looking at as a bullish proxy trade for Nvidia's earnings, do those levels stand out to you? 265, 285. Did they come up in your technical analysis? >> Well, I was I was pretty close. I had 264 and 286 to to just being very granular here. But um so the reason I had those levels is if we were to look at our chart, we can see that um we have uh uh the point that our first green line is at there or rather uh our first green line 286 that was an old high point and then subsequent low point that we saw before we started to move downward here. Uh 275 was next as it was a repeated low point as well as as well as being prior to that a high point. And then 264 we just kind of have drifted through that point to the downside. That was where gap opened up to go even further to uh to the downside a bit more. 233 was the uh roughly the lows we had after an earnings gap up in February that we tested repeatedly. We did break through them a little bit after last earnings but we recovered pretty quickly here. So, uh, overall prevailing shape, a downward sloping channel here, starting with those highs near 380 or so. Uh, that's between our two white boundary lines there. You can see as well that our blue trend line that was pointing upward has been broken at this point too. So, to think about our our moving averages, we have uh fallen below our three moving averages that are uh focusing on the shorter term. 5-day, 21-day, 63-day exponential moving averages in dark blue, teal, and gold, respectively. The closest one is our 5day EMA at about 263 or so at this point. Now, I don't have the 200-day SMA. We have the 21-day exponential moving average. That one comes in a little bit to the downside here, just shy of 243. So, the same deal, though, a notable long-term uh potential supportive area. RSI still pointing downward here back below the 50 midline but remaining above that 30 threshold that would represent the oversold area. So now in this case our volume profile study shows that we have uh a node that we are on the verge of falling below here 253 to about 275 is where that one comes in rather thinly traded uh as well until we start getting down near the the 200 uh 175 level or so. All right. And right now we're just below that range you highlighted. We're at 25204 with this three and three/4er percentish move to the downside so far today. Scott, your second one uh is more of a play not on an individual semiconductor name, but it's on this three times shares leveraged ETF here, the direct semiconductor bull 3x shares. How are you looking at this one? >> Yeah, exactly. This is the SOXL. And like you just said, Marley, rather than looking at an individual stock, I I like the SOXL because uh this is going to be representative of of the entire sector. So what I'm doing is again just like Verdictive, this is right down to the 200 day simple moving average here, which has in the past lent a lot of support. So I'm buying September 18th going out about a month. September 18th expiration 110 125 call spread. bullish call spread here. Looking to pay about $4, maybe a little bit less for that. And I'm giving myself on some time here just in case because of Nvidia, you know, we we go sideways, we go down a little bit here, but I love that support that I see. >> All right, Rick. So, as we look at it, uh, semi under some pressure today. So, Socks is down more than 11%. What are you seeing in the technicals? We know that semis have been a part of the rotation of late in and out in and out it feels like. >> Yeah, to be sure. And what I think one thing that we could call attention to to the downside first would be our most extreme low point that we saw in recent times. Uh it's our first green line there near 91. Lines up with another low point from uh previously here. It was a small uh uh dip that we saw during that rally here. Uh but it still lined up uh the same. there was a small gap as well. So below that 63 to 57 was another gap level here. Uh that would be quite a move to the downside here. But just calling out notable technical levels as I see them. Meanwhile to the upside, the first level of resistance that I have highlighted is our red line there near 138. The reason why is that it was a high point after a gap to the downside. Then we also have 157 and 166 for two more relative high areas here. So uh in terms of our overall price pattern downward sloping trend line uh in blue there that began with those highs near 302 was broken. We had more of a symmetrical triangle type shape pushing sideways then here which we do seem to be uh moving below the lower end of that so far today. So now again our 251day EMA our exponential moving average is coming into focus here because that's around where price is right now. that orange line that denotes uh 251 days of trading activity which is typically what you would have in one year uh the trading days here. So that comes in at 10764. So this is an interesting area that we find ourselves at right now because the longer term the moving average the more significant it is as a source of potential support or or resistance if it were going the other way here. Meanwhile, our 5day EMA in dark blue near 120 is the first that we would find to the upside. It coincides with our old broken trend line as well. RSI moving lower. We are below the 50 midline. Short-term downward sloping red trend line is in place. So, if you had more of a bullish outlook, look for that trend line to be broken and for a push back above the 50 midline to take place. Volume profile, not too terribly much help here in this area, but the the best we can do is kind of identify between roughly 105 to 120 or so is where we had a small node. But by far the the majority of our trading activity took place between about 35 to 55 or so. >> All right. And right now we are down again 11% here as we see semiconductors move out of favor on today's session and a sharper move in this one. Socks L. Now as we look at Mastercard here, Mastercard moving in the other direction. We're up close to 3% this morning. Scott, how are you looking at the payments industry right now and Mastercard specifically? you know, the these stocks keep going higher and higher and we're getting data about the consumer and the consumer, you know, spending less and and starting to get in trouble a little bit. But from the looks of Mastercard, Visa, even American Express, you know, the the charts are looking nice. However, however, I'm looking at the contrary play here in Mastercard because right above this 600 level or so that we're at, that has been a top that has been major resistance in the past. So, what I'm doing is I'm going out a month again or so, September 18th expiration, and I'm just buying a simple put spread. Not really looking for Mastercard to, you know, make a big big selloff, but I think it hit that resistance. So, I'm buying the 580 570 put spread. I'm looking to pay under $2 for that around a$180 and we'll see what happens. Again, if Mastercard keeps going up, stays here, the risk that I have is what I paid for that spread. >> All right, Rick. So, as we look at Mastercard, I mean, Scott just highlighted they are year-to date only up about 4 and a half%, but as we look over the last month, there's been momentum on their side. We're up more than 10%. So, are you seeing similar levels here? This major resistance point just above where we are right now. We're at 597, a near 600 that we may run into and potentially move lower. >> Yeah. And the reason I would also highlight that is because that was our old highs that we saw 60162. That's our red line on our chart here. 580 is also the same level that I had highlighted as well as our first measure of potential support that that was really important. The reason why is that it matches up with uh an old high point that we saw from uh back in October. And it also matches up with where we found our closing highs. You might see that period there from uh December or so onward. Uh we did make some intraday highs beyond that level. But in terms of our closing highs, which are typically regarded as being more important, we never really made our way above that point until just uh uh our last session where we closed just a hair above that level. So now when you have an old resistance point that that is breached that becomes a significant area to watch to the downside for either a bounce if we do get a pullback or a breakdown if the move doesn't hold. So 580 stands out to me as well. Further to the downside though 555 to 552 was a small gap that we saw as well as some old highs there. So that could be another point to watch out for. in uh additionally our price pattern is our channel type shape here between our two white lines has been fairly consistent so far along those lows. Just duplicate it, put it across those highs. Uh it matches up decently in this case here. So you can uh use that as a potential way to find further support or resistance. So in this case, our moving averages are are all on top of each other with the the shortest to the longest in order here. They're diverging farther apart from each other. So, we're not seeing a sign of trend interruption just yet here. Uh RSI also moving into the overbought area, that threshold above 70. So, if you were looking for a breakdown, again, that 580 point stands out because 582 or so is where our 5day EMA and dark blue comes in. So, that gives us a confluence. Then the old highs line up with our short-term moving average. So, if it were to break downward, that would start to be the sign of potential trend shift there. So here our volume profile shows that we do have uh some significant nodes uh in this area. So around 560 to 570 is where things really start to pick up. So for the uh shorter uh strike of that put spread here that would make sense from this perspective here because that's where the heavy trading activity is. So you could see consolidative price activity if we do get down back to that heavy trading activity level. All right, and as we look here at Mastercard again, it's up 2.8% at 596.95 right now, just below that allimportant 600 level Scott highlighted and those old highs of 60162. Really appreciate you both being with us today for big three, Scott Bower, and of course Rick Dat for breaking down in the technicals for us.