Wealthpop

Another simple trade set up for everyone again on this Monday morning, coming from Amazon (AMZN). Our trade today comes with the added benefit of having an extra confirmation built into the set up at hand. What do we mean by this?
Well, if you watch the video breakdown below, not only will you see that AMZN has formed a well-defined upward channel as it has climbed for the past several weeks, but it is also coming up to a pretty meaningful resistance level. In the short term, this could set us up for a short play as you look for price to reject off that resistance level.
This overhead level could mean there is a bit more of a pullback on the way as the stock attempts to push higher. That level of resistance is right above that 124 mark and as you see from this mornings price action, the stock has already reject off a level near there. The rejection this morning came at 124.8. Now, we will look to see if the stock can push higher or if this was the final straw that will initiate a larger pullback.
Bulls will want price to break and hold above this resistance level in order to resume the upward momentum trade. However, if price does reject off this level and go lower, you would get a good entry for a long trade after the price finds a local bottom after this reject. Either way, once again, patience is key.
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Learn to find these levels for yourself when you join The Profit Machine. There, you’ll learn all about my favorite stocks, setups, strategies, and plenty more. You’ll also be invited to weekly webinars where I answer questions and go over important trading lessons, like the one in today’s article. The best part, you’ll also receive live trade alerts. Not only will you get a world-class education, but you’ll earn while you learn.

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Christian Tharp, CMT

– ETF Watchlist –
Well, as we thought, the market blew off some steam only to resume the path higher. Consumer discretionary and tech led the way, which you would expect to see in a rally, so that’s a good sign. The more defensive names, once again, settling toward the bottom of the barrel.
If this rally is continue on it’s path higher then we have a couple sectors we can look at. The first is the most obvious of the bunch, a run at the tech sector. The next, consumer discretionary, but the one we have been keeping an eye on for a little while, retail.
SPDR S&P Retail ETF (XRT)
The retail sector remains a tough cookie to crack, especially with the stubborn strength of the consumer. Much to the Feds dismay, spending remains on a hot streak with few signs of slowing down.
If the strength of the consumer continues, it could power names like Amazon (AMZN) and Walmart (WMT) to carry the ETF higher as well. Even despite inflation that refuses to take a meaningful dive lower, consumers are still shopping with their favorite brands. This bodes well for this sector going forward, especially after the market pulls back a bit.
If the rally shows it has legs, you may want to keep this sector on watch for a way to trade the sector’s strength to the upside. Remember, for these longer trades, entry is still going to be key. Don’t just decide you want to trade this and jump in, plan your entry so you can get as much of the upward move as possible and also give yourself the best risk management possible.
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Join my Smart Trades options trading service today to see exactly how my students and I trade these types of scenarios! Smart Trades is where I teach my students how I trade options on some of the largest ETFs on the exchange. As you learn, you’ll get exclusive access to all my trades with notifications any time one is put on. Now, you can learn how many use this high-income skill to achieve financial freedom. Join today and as always…
Good Luck With Your Trading!
Christian Tharp, CMT

– ETF Watchlist –
As we always say, there’s always opportunities in the market, no matter what direction things are going. Wednesday’s session brought the long awaited pull back we were anticipating after the surge in stock prices over the past several weeks. Whether this is a full-on reversal or just some healthy profit taking, it’s still too soon to tell. However, with that pull back new areas of the market received some life.
One of those areas of the market that has finally come back to life, energy… more specifically, oil names. With stocks in a free fall yesterday and the Saudis attempting to stabilize oil pricing, this sector was one of the few left standing after yesterday’s carnage.
SPDR S&P Oil & Gas Exploration & Production ETF (XOP)
As oil seems to have found new legs in this market, we want to keep an eye on XOP to see if this turnaround has any legs that will keep the sector running. With the Saudis coming in to support healthy oil prices, there may be a little more fuel left in the tank and if the market continues to sell off then we could really see a run on energy stocks.
Nothing terribly convincing in terms of what the best trade is, but this is something you definitely want to keep on watch in case we do get a full rotation from the tech and consumer discretionary sectors.
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Join my Smart Trades options trading service today to see exactly how my students and I trade these types of scenarios! Smart Trades is where I teach my students how I trade options on some of the largest ETFs on the exchange. As you learn, you’ll get exclusive access to all my trades with notifications any time one is put on. Now, you can learn how many use this high-income skill to achieve financial freedom. Join today and as always…
Good Luck With Your Trading!
Christian Tharp, CMT

After yesterday, the market isn’t looking all that strong. The pull back we have warned about finally took place and there’s no real telling if the selling is through. With that selling, there are a lot of bearish trades that are forming in the wake of the market tumble.
One of the best set ups we have found this far comes from Salesforce (CRM) after forming one of the most bearish chart patterns there is, a head and shoulders. Now, the price has a very important support to hold, otherwise, there is a steep decline in the cards for the stock.
Not only is this pattern coming into play for the stock, but we have a whole psych number acting as support that is not too far off at the moment. A break of this would surely mean lower prices are ahead and we could see a drop all the way down to 190 if selling pressure was to pick up again.
Check out the video below for the full video breakdown and see if this trade fits your plan and edge to trade. If nothing else, be sure to keep it on your watchlist as the week wraps up.
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Learn to find these levels for yourself when you join The Profit Machine. There, you’ll learn all about my favorite stocks, setups, strategies, and plenty more. You’ll also be invited to weekly webinars where I answer questions and go over important trading lessons, like the one in today’s article. The best part, you’ll also receive live trade alerts. Not only will you get a world-class education, but you’ll earn while you learn.

Get a jump start on your options education and put yourself in position to win in 2023. Sign up today! Until then…
Good Luck With Your Trading!
Christian Tharp, CMT

– ETF Watchlist –
For those who are closely watching this market in case of a turn around or at the very least a pull back, we are getting close to the area where that has a higher probability of taking place. For example, the next big level to watch on the S&P 500 is 4300 and we just came up to that level before rejecting down, 4299.28 to be exact.
This zone has a lot of resistance overhead, which is something traders will want to look out for. While this doesn’t suggest the market will make a U-turn here, it does suggest that there will be more and more resistance ahead.
To find these levels and zones of resistance, we must first look back on history for when prices were in this area before. We can use history to show us where the pockets of supply and demand might be and then map out those zones in the process.
SPDR Gold Shares (GLD)
One trade idea we are on the look out to execute on is gold. With gold approaching that 2000 mark once again, we would like to see it overtake that level before establishing any long plays on it. With all the attention gold is attracting once again, we want to be mindful of the rise in price that purchasing could spur. Central banks and countries around the world have once again taken to stockpiling the shiny metal.
Whatever the reason, it isn’t much concern to us, but the fact that this buying is taking place is what we want to pay attention to. The big boys aren’t the only ones buying gold either. Even retail investors are adding gold to their portfolios in order to prepare for whatever economic turmoil may be heading this way.
Another positive development for those investing in gold, the recent meltdown of the crypto market following the SEC suing crypto companies Binance and Coinbase. Again, whether this is good or bad for crypto is not really a cause for concern, however, this event may push more people into the safe haven gold has traditionally been.
So, again, keep an eye on gold taking that 2000 level for another push higher.
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Join my Smart Trades options trading service today to see exactly how my students and I trade these types of scenarios! Smart Trades is where I teach my students how I trade options on some of the largest ETFs on the exchange. As you learn, you’ll get exclusive access to all my trades with notifications any time one is put on. Now, you can learn how many use this high-income skill to achieve financial freedom. Join today and as always…
Good Luck With Your Trading!
Christian Tharp, CMT

– ETF Watchlist –
It is not out of the realm of possibility that we get a pull back soon. If we just look at SPY, we are just starting to break into another supply zone, a zone where big sell order were sitting in the past and unfilled sell orders could still be lying in wait.
This gives us a suspicion that soon could be a good time to look for put plays. Now, we could go the old fashioned route an find some levels to swing puts on ETFs like SPY and QQQ, but we can also buy equity on some bearish leveraged ETFs for a little more of a safer play, or buy calls on one of those ETFs. Let’s look at an example for when the time of a pullback comes.
ProShares UltraPro Short QQQ (SQQQ)
SQQQ is a great example of one of the leveraged ETFs we can look to in preparation for a pull back, which are always bound to happen at one point or another, the only question really becomes the severity and length of the pull back. Every hot market needs to blow off some steam. For more conservative types, going long equity on SQQQ can be a bit of a more relaxed way to get ahead of a little downside movement.
However, those looking for a more aggressive approach can buy call options on the ETF. That may sound counterintuitive, but since the ETFs price goes up if the market goes down, then you would want to go long this ETF, which means you’re really going short the market.
Of course, you can certainly go the old fashioned route and short SPY or QQQ, but we would be remiss if we didn’t at least give you some different options here. See what works for you and execute!
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Join my Smart Trades options trading service today to see exactly how my students and I trade these types of scenarios! Smart Trades is where I teach my students how I trade options on some of the largest ETFs on the exchange. As you learn, you’ll get exclusive access to all my trades with notifications any time one is put on. Now, you can learn how many use this high-income skill to achieve financial freedom. Join today and as always…
Good Luck With Your Trading!
Christian Tharp, CMT

Ask any old trader whose enjoyed any level of success, what’s the secret to their longevity and it will most likely be some variation of the ‘R’ word… Risk.
You can employ any combination of strategies and methodologies, but without them being joined at the hip, neigh ruled, by a strict set of risk management tools, failure is already a forgone conclusion.
One of the easiest ways to do that is to use the “R” method, which was developed by Brian Lund.
For Lund, “r” represents a fixed dollar amount, which represents both the risk and reward you’re willing to accept on each trade. This will properly allocate individual position size within your overall trading account, as well as how much of that trade your risking, or willing to lose.
It is best arrived at by using a percentage of your total trading capital. It allows you to size your position in relation to your risk level instead of in an arbitrary way.
For example, if you have $50,000 available in trading capital (cash not including margin), you might use one-quarter of one percent (.0025), or $125, as your “R” factor. Take that one step further, the total amount you are willing to risk per trade, such as 20% loss on that trade where you are using that $125. This means you are ultimately risking $25, just as an example of how risk management should work.
In the highly technical example below, (A) is a former support level that failed and now is a potential resistance level.
Price is trapped between (B) and (C) level, and you are looking to go long if it breaks back above (B).
You know that a reasonable stop-loss would be just below level (C), so you determine the price distance between your entry just above (B) and your stop just below (C).
Let’s say that this distance is 50 cents. You now take that distance and divide it by your “R” factor, which gives you a position size of 250 shares ($125 / .50 = 250).

You now know that if your trade fails and hits your stop-loss, the most you can lose is $125. The goal then becomes to only take trades where you have the best potential reward for the risk you’re putting up, ideally 1:3 (risk to reward).
In this same example, the resistance level of (A) is a reasonable target for a successful trade, so you determine the distance between your entry just above (B), to the target of (A). You then divide this number by your “R” factor to see if the trade is worth taking.
If the distance between (A) and (B) is $1.50 then you have a 1:3 risk/reward ratio and the trade is a good bet ($1.50 / .50 = 3).
The higher the risk/reward ratio you have on your trades, the fewer times you have to be right and still make money. One South African firm only won 30% of their trades, but was still wildly profitable, due to proper risk management.
As you can see, if you only take trades that have a 1:3 risk/reward ratio, you only need to be correct 50% of the time to have a 10R profit after ten trades.
Knowing how to use risk/return and position sizing allows you to make sure you are never overextended on a trade and ensures that you’ll always be able to return to fight another day.
Risk management is just one of the various trading topics I go over routinely with my students in the Options 360 trading community.
If you’ve been looking for world-class trading education, check out this short presentation to learn more about my trading methods and how joining the Options 360 community can help take you trading to the next level!

Today’s stock, Hilton Worldwide Holdings Inc. (HLT) is a great example of finding a stock that has relative weakness in a strong market. This is almost always a clear sign of a possible short play.
As you can see in the video, while the market has pressed higher and higher over these past several weeks, HLT has remained somewhat weak and in the best case, has just kind of consolidated. You may see higher highs on the chart as well, so this could lend some credence to the fact that the trend is still moving upward. However, this 135-140 area is worth a watch.
Any failure to hold this area should imply lower prices, at the very least, in the short term. Investors could use this area to gauge whether or not a larger sell off is in play. Now, to make things a bit more interesting, you’d want to see what this stock does compared to the overall market.
A relatively weak stock is highly susceptible to a reversal in the market. More importantly, is to see what this stock does if the rally continues. If the divergence continues, I would keep this stock on your watchlist for a possible short play.
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Learn to find these levels for yourself when you join The Profit Machine. There, you’ll learn all about my favorite stocks, setups, strategies, and plenty more. You’ll also be invited to weekly webinars where I answer questions and go over important trading lessons, like the one in today’s article. The best part, you’ll also receive live trade alerts. Not only will you get a world-class education, but you’ll earn while you learn.

Get a jump start on your options education and put yourself in position to win in 2023. Sign up today! Until then…
Good Luck With Your Trading!
Christian Tharp, CMT

On Wednesday, Nvidia (NVDA) shares surged an eye-popping 30%, adding over $200 billion to the company’s market cap and sending the stock to a new all-time high.
The source behind the strength? Incredible demand for the company’s new chips, which are expected to be the backbone for running many Artificial Intelligence (AI) systems that are in development.
It’s not just NVDA riding the AI wave, the biggest stock gains this year have come from companies that will either be supplying the tech to build AI infrastructure or businesses that will benefit from integrating AI features, such as Large Language Models (LLM). By some measures nearly all of the Nasdaq’s 100 (QQQ) 22% year-do-date gains have been fueled by AI related stocks such as Microsoft (MSFT) and Alphabet (GOOGL).
So, it might be surprising to find an AI ETF, like AI Powered Equity ETF (AIEQ), that not only didn’t participate in the rally on Thursday, but is actually down some 5% for the year to date!

This is just another reminder of the importance of doing research and making sure you know what you own. Magnifi is here to help.
Why has AIEQ fared so poorly despite seemingly being positioned dead center in the hottest investing trend in the market?
Well, the irony is, despite its name AIEQ doesn’t not invest in AI-related companies at all! What AIEQ does is use AI to pick stocks.
AIEQ owns no NVDA, Apple (AAPL), Microsoft (MSFT), or any number of the “in play” AI stocks. Rather, of its some 150 stocks in the fund’s holdings, its heaviest concentration of holdings, with a 31% weighting, are in the consumer discretionary sector. Names such as Wingstop (WING), William Sonoma (WSM) and Ollie’s Bargain Basement (OLLI) are among the fund’s top holdings.
Due to the name and similarity to other ticker symbols, some investors might have mistaken AIQE for the Global X Artificial Intelligence & Technology ETF (AIQ), which does count AAPL, NVDA, MSFT, GOOGL among other true AI-related names as its top holdings. AIQ is up a solid 21% for the year to date. 
Launched in 2017 AIEQ is among the oldest of the artificial intelligence-powered ETFs, yet it only has a mere $105 million assets under management and the recent performance probably won’t help generate new inflows anytime soon.
“It is ironic that an AI-powered algorithm has not capitalized on the rally in big tech stocks that’s been driven by its own disruptive technology,” said Jessica Rabe, co-founder of DataTrek Research.
“AIEQ has previously tended to work best when it could catch momentum driven tech names in broad-based market rallies like during the pandemic crisis, but it’s clearly failed to do that this year,” she added.
Aside from not owning the best performing names, AIEQ’s best performance tends to come during bull markets when the models latch onto momentum trades, according to DataTrek’s Rabe. Given that the stocks are only recently coming out of an 18-month long bear market, and doing so in a herky, jerky fashion it’s somewhat understandable that AIEQ’s performance has been lackluster. Still, it has to come as a major disappointment that AEIQ’s algorithmic process stumbled so badly in not identifying the AI craze and failed to join the bandwagon, which started rolling over three months ago.
All this is to say, be aware, or even wary, of what are sure to be a slew of new ETFs offerings that will employ artificial intelligence to build and actively manage portfolios.
For example, just last week Roundhill Investments launched the Generative AI & Technology ETF (CHAT). According to Roundhill, CHAT will invest in companies advancing generative AI with the twist of applying the new technology to its own stock selection within the AI universe.
CHAT is off to a good start with its top holding being those usual suspects such as NVDA, MSFT etc. helping it to gain 4.1% since its launch on May 18th.
Time will tell how these AI-powered funds do over the long haul, but as Rabe of DataTrek says, “We find AIEQ is an interesting case study for asset allocators and stock pickers because its investment process differs from traditional approaches. But, as with some of what we are all learning from ChatGPT, different doesn’t always mean better.”
Let’s get a side-by-side view of the AIEQ and AIQ ETFs and let their metrics help you decide which is a better fit for your portfolio.

To further your research these funds and other ETFs, as well as other funds that can help power your portfolio, be sure to get access to Magnifi.
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The market seems to be showing some signs of wanting to pullback a bit after the run up over the past week or so. For the S&P 500, after surmounting that 4200 on last week and again on Monday of this week, it quickly retreated back below that level.
While this may not mean the end of the rally, it could be a signal of the market getting ready to blow off a little bit of that steam. A pullback here would likely bring back 4150 back into play as a point of support for the S&P.
From an individual stock standpoint, the big tech names have begun this selloff. Google (GOOGL), Microsoft (MSFT), and Nvidia (NVDA) have all started Tuesday’s session in the red, retreating back to support levels. Only time will tell if they can recover in the coming days to resume the rally. Tesla (TSLA), however, has not followed this path a continues to push higher this week.
As far as ETFs go, there since much of these moves have been led by the big names, there hasn’t been much participation by the ret of the stocks in these indexes and ETFs. When there is some broader participation from stocks that aren’t as heavily weighted in these ETFs the rally should begin once again.
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Join my Smart Trades options trading service today to see exactly how my students and I trade these types of scenarios! Smart Trades is where I teach my students how I trade options on some of the largest ETFs on the exchange. As you learn, you’ll get exclusive access to all my trades with notifications any time one is put on. Now, you can learn how many use this high-income skill to achieve financial freedom. Join today and as always…
Good Luck With Your Trading!
Christian Tharp, CMT