SPX Holding Below Resistance: March 13 Stock Market Preview
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Tonight’s YouTube video looks at the latest moves in SPX, the VIX, BTC, MSFT, and NVDA, so check it out! You can view tonight’s and prior YouTube videos by clicking Community at the top of our homepage to find our YouTube channel link.
Various metrics are beginning to show signs of notably oversold conditions, matching April of 2025 lows in some instances.
While a bounce may be near, and with some positive divergences as well, we can’t ignore the VIX continuing the pattern of higher lows, even though we haven’t surpassed Monday’s high just yet.
As mentioned in our YouTube video, most of the positive GEX rests between 30-35. Might the positive GEX picture for the VIX combined with the idea of a potential low being near for indices imply a brief VIX spike toward 35 again before we see a rebound into OpEx week? That’s at least one possibility.
SPX continues to show curious volume at the 7000 strike, yet most of the net GEX remains at 6700 and below.
SPX remains below key moving averages, which are now declining sharply.
The largest net GEX clusters on either the positive or negative side range from 6400-6600, and the lower Keltner channel is still near the 6500 mark.
While 6400-6600 may mark a low, we can’t determine timing from the chart alone, so we maintain awareness that a bounce higher could happen at any time without invalidating the possibility of an eventual tag of those areas.
Given the momentum lower, my personal expectation (as to my perception of the most likely scenario) would be a near-term low between 6500-6600 and a strong bounce to follow next week, but I’m also wrong sometimes.
Closing above 6765 would be a positive sign, while rejection from that same area likely favors more downside, in my view.
SPX net GEX has reached the lowest reading since the selloff began, yet we still don’t see a negative extreme on our GEX Intensity Gauge, comparing SPX net GEX to prior readings over the last 12 months.
SPX net GEX in particular seems to shift less dramatically compared to QQQ or SPY, and reaching an extreme is not necessarily a precursor for a rebound, though I would certainly have increased confidence in a low IF we saw SPX reach such an extreme. IWM is closer to an extreme, but more on that later.
QQQ had the 2nd lowest daily close since 2/5, still not retesting Monday’s lows.
The close below the large GEX cluster at 600 does open the door to lower lows, though, with 575-580 still appearing to be potential targets on a break of 590.
The lower Keltner channel near 565 doesn’t yet match with meaningful negative GEX relative to other negative GEX strikes, but the positive GEX clusters above 600 certainly show little interest.
For reasons discussed, I will be watching other indices for signals to take long or short trades, unless I see QQQ reach 565-570 or break above 605.
IWM volume has remained consistently elevated below 250, and especially at 235-240.
We also see the largest net GEX clusters within the 240-250 range.
Given the sharply declining moving averages, the lower Keltner near 237, and the GEX picture, IWM may yet again prove to be an early indicator of a broader rebound, so we’ll keep on eye on Friday’s action.
To look at IWM from a different perspective- the data graph shows the same GEX picture as shown on the chart above, but we also have the GEX Intensity Gauge and the GEX Weighted Volatility Gauge shown for additional context.
The Intensity Gauge is not yet at an extreme (-2B or greater negative GEX), but it’s close. The Volatility Gauge (showing implied volatility as compared to the prior 12 months) is well beyond an extreme.
The Intensity Gauge is the last one that hasn’t reached an extreme, and combined with current GEX readings, any approach toward 240 combined with the gauge reaching an extreme could be a good long entry, in our opinion.
We shared some timely data in Discord Thursday morning and we’ll do the same on Friday, so we hope you’ll join us in Discord to continue the discussion!
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