I used to have a lot of trouble trading something that had already advanced significantly. If something was going to the moon, I’d either wait for a pullback that never came, miss one that was so quick or shallow, or worse, I’d try to predict the reversal and short it.
I started to explore this need to short when things are extended, or this hesitation to get in when something is already trending (yeah, I know how little that makes sense 😅). What I discovered was these two things:
Fear: I hesitated getting in because of fear. When something has already moved, there’s this underlying fear that it could pull back at any moment. So instead of following the trend, I would sit out, or look for a move in the opposite direction, not because that’s what price is doing, but because it felt safer.
Ego: I would try to catch the reversal when I felt I didn’t fully capitalize on the upside, I would shift into, okay, I’m going to make it up by being right on the downside. And from my experience, trying to short in a strong uptrend rarely works out and just distracts from getting positioned for the next upside move.
So after digging into what was going on internally, and having a lot of conversations with myself, I arrived at a point where I could recognize when my actions were driven by fear or ego.
Now, when I see price extended, I remind myself that it doesn’t mean it can’t continue. This helped me a lot last week when I put on new positions in names that had already traveled a great deal. I just set my invalidation on the intraday chart and use the daily as my directional guide…as long as price is still trending along a key moving average or structure, the direction is still up.
Charts > Feelings. Follow the price action.
SPX Review and Outlook
We saw another strong move higher this week.
Price continued to build on the prior push, moving with momentum and clearing through the 7,000 level without much hesitation. There was a brief retest near it, but overall, price moved through and kept going, putting in a new all-time high of 7,147.52.
SPX Daily Chart
Looking Ahead This Week
In a strong uptrend like this, I want to see how digestion shows up. Typically, I see two main forms:
quicker pullbacks
where price may move down fast, tag a level or a moving average, and then get bought up relatively quicklymore drifty digestion
where price moves sideways, or slowly drifts lower, giving time for the moving averages to catch up while buyers are still present
With this in mind, here are some scenarios for the coming week:
Shallow to Moderate Pullbacks
After a move like this, some form of digestion would be normal, whether it shows up quickly or more gradually.
This could look like:
a shallow pullback into the 5 EMA, possibly aligning with the recent gap area around ~7,040–7,070
a retracement toward 7,000, which is the previous high and the top of the range from October 2025 through March 2026
a pullback toward the 10 EMA, which could bring price closer to the ~6,900 area
a slower, more drifty move sideways while the moving averages catch up
Deeper Pullback into Prior Breakout Area
If we pull back further, then the 6,794–6,796 area comes into play. This is where price broke out, retested, and then accelerated higher, so if we revisit that zone, I’ll be watching how buyers respond.
Remember, keep things simple, stay grounded, and focus on what actually matters: price, structure, and process.
P.S. I just want to say welcome to everyone new here! How awesome that my 15 minutes of YouTube fame brought so many of you here 😅 Welcome, OVTLYRs!! I’m really glad you’re here. If something resonates from this edition or any of my previous ones, feel free to reply or reach out, I always enjoy hearing from you ✨
