Chapters
00:00 Intro: Week 22 & an Outside Reversal
01:39 GP: The October-High Seller & Boomer Stocks
03:44 Silver, Expiries & a Flow-Driven Market
04:45 Exhaustion on FinTwit & the 2021 QQQs Top
08:02 How to Trade It: Flat Every Day?
10:06 The Destruction Underneath: $PYPL, $MSFT 400 & $META
12:51 Housing Strength That Makes No Sense
15:00 No Edge: Trade Small, Wait or Go Flat
18:10 Portfolio Savers: $XOM, Rio Tinto & $FSLR
20:18 FOMO, Lack Mindset & Corrections Through Time
23:26 XLE and the $XOM Fib Entry
25:35 Nothing Sticks: $META's 691 Island, $SPOT & $COIN
28:19 The NQ Playbook & the Red Board
30:29 $PLTR, $HOOD & Price Peaks Before Growth
33:49 Nick's VIAV Winner & What Mag Earnings Can Do
40:02 Day-Trading Silver: The First 60-Minute Range
46:06 Shorting Parabolas & Iron Condors
51:28 Space Bids, Futures Shorts & Waiting for an Edge
55:21 Bitcoin's 30/40 Cross & the IGV Wedge Drop
1:01:45 Final Words
Market Hours #165 went out live on Tuesday, February 3, with Nick and GP. Ben was out, and they joked that they needed him "to keep us grounded." It was week 22 of the range in the Nasdaq. A bounce off the 50-day on Monday turned into an outside reversal on Tuesday. The QQQs were down about 1.7% while much of the board was down far more. GP and Nick were honest that neither had an edge. They talked about what to do when nothing sticks: trade small, wait or go flat. Boomer stocks and housing were mysteriously strong, Palantir showed why price peaks before growth, Nick explained how he'd day-trade silver's gap, and they read Bitcoin and the IGV's "wedge drop."
Nick's setups, levels and trades
Nick opened on week 22. He'd thought an outside reversal would look disgusting. Then MBG tweeted that he was lightening up, Nick replied that Dio said to "put your man pants back on," and asked that it not be a market-top tweet. "Sure as [expletive] we got the roll today." He wondered what would bust them out of the range. The 2021 QQQs top had similar double-top "horns" but broke down after 12 weeks, so this feels "more of a correction through time than price." In the boomer names, Honeywell was busting out of a massive range, XPO took off and Old Dominion broke out of a wedge. Across FinTwit he felt "exhaustion," not despair, with StockTwits quiet and more posts about names to DCA in a correction. His P&L was "chopping sideways." Buying a gap-down Monday on the 50-day with an engulfing bar is usually a no-brainer, though the volume wasn't confirming, and then came the outside reversal. With AMD that day, Google and Uber Wednesday and Amazon Thursday, he thought Wednesday and Thursday could define the market's direction. Cookie's aggressive March call was "looking a little suspect."
He said he'd told a client that people who get chopped up by FOMO tend to have a lack mindset, "like there's never enough." The market is like a casino with infinite opportunity, so getting chopped is a signal to cut size or take a vacation. Since about week 12–14, he's used smaller size and more patience. From his O'Neil reading, corrections often run 8–12 weeks, and missing a breakout after that sweet spot says the market needs more time. Loud noise usually makes him lean bullish, since max pain is higher, and his feisty mood Monday worked for exactly one day. He sees XLE and energy as the focus for swing traders. If you're not already in XOM, you've missed the entry, but you could drag your fibs up to the 50% near 132, in line with a gap, as the 50-day curls up. On Meta, 691, the prior island bottom, is what needs to hold. He has a decent winner in VIAV off a stage-one base on the monthly, an idea he took from a MarketSmith user, and liked the look of CMP. He noted that Amazon has been in a range for about two years. Apple is about 8% of the QQQs and Meta under 4%, so Apple's breakout not lifting the index surprised him.
On silver, he walked through his day-trading process, which is based on the first 60-minute range. Because the gap didn't fill in the first 60 minutes, he'd have read it as a gap-and-go, gotten stopped out on two entries and then reversed. His target would be between 153 and the gap fill, and he'd exit at the gap fill, since a late fill is support to lighten into, not to hold. He rarely lets day trades turn into swings. When parabolic names finally break, there's plenty of intraday opportunity. A leg in any direction retracing 50% is normal, and silver failed right at the 50% of its candle. Silver's daily stochastics were wildly oversold, so shorts should have anticipated the bounce, and the 50% is the line in the sand for anyone reloading a short into an ABCD leg down. He still sees a trade into the 200-day, with the line above the 10 and 20, and he trails stops rather than trying to call tops. Options Sean, due on the show in two weeks, had been net short silver through an iron condor, early but still profitable.
He thinks you're limited to day trading and small size, and swing shorts are working better than swing longs. He caught XPO without the conviction to size it, and he finds every countertrend bounce in a collapsing name impossible to hold through on a short. "If breakouts aren't working, you've got to have the wherewithal to sit on your hands." On Bitcoin, he didn't like the 30- and 40-week crossing and wouldn't be surprised by something more violent, gravitating toward the low end of the prior range. He sees 50,000–60,000 as a level to trade against on the upswing and would be a buyer down there in a full collapse. Ethereum looked gross too. The IGV put in what he calls a "wedge drop," a symmetrical descending wedge that sliced through the 200-day and dropped. He's in the camp that the range low gets tested and possibly undercut. Like Bitcoin, 76 might be the IGV level to play against on the upswing as an inverse head and shoulders builds, not on the first test of the low. If the mega caps drop out of their range, it'll look ugly, and he'd set alerts both ways on names like Nebius, which could retest its 50-day 20–30 points lower.
GP's setups, levels and trades
GP said the weakness underneath is "palpable," while Tesla only wants to go up when the market is dying. A persistent seller at the October high destroys every push at the top and covers at the bottom, and he figured the NQ still had about 300 points to the range low, probably with an undercut. Boomers are loving it: FedEx, UPS, IBM, Cisco and Royal Caribbean are crushing it. Gold and silver were giving it up too. Silver got crushed Friday on the month-end expiry, popped when there was no expiration and would likely die again on the next one. It's a market "dictated by flow," with Monday and Friday options on a lot of names, and he thinks the derivatives market will eventually overtake the stock market. The destruction includes Reddit, DoorDash, Disney and PayPal, hammered on earnings, which Joey Rock dubbed "Pain Pal." Microsoft looks headed for a full gap fill toward 400, Meta rejected its earnings gap and is going back to fill it, and Coin can't find a bottom. He "blasted out a lot" on Friday because of bad weekly and monthly closes. Housing names like Home Depot, Lowe's, BLDR and even Opendoor were strong, which makes no sense if people can't buy houses.
With no edge, he said you can trade small, wait for the edge to return or go flat every day. Swinging doesn't work. Buying puts to hedge has gotten people hurt twice, like 2021–22, when names got crushed but the indices didn't break. He's more concerned about a dot-com-style scenario of another couple of months distributing at the top. Trends that had held, like metals, are breaking one by one, and SanDisk and Micron were showing big volatility at the top, possibly the start of consolidation or "a straight destruction period." His "portfolio saving names" are Exxon and Rio Tinto. First Solar is "a miserable trader," a low-float name that probably needs a split. If every stock you sell reverses right after, "you have no edge," so step back. Nothing sticks: AMD earnings will be a one-day wonder, Meta sold down for three days after earnings, Spotify was down another 7% and Oracle hadn't stopped falling since the capitulation to the upside above 300. Most people probably hold 1% in FedEx and 10% in Tesla, so they're feeling the pain. Netflix is "going to 69."
On the NQ, the playbook is simple: tag the top of the range, go sideways for 24 hours, then head back to the bottom. "These sideway actions aren't bullish consolidations. They're distributions." He read off the board: QQQs down 1.74%, Nvidia 3.7%, Microsoft 3%, Broadcom 6%, Coin 5.4%, Spotify 7%, Hims 6% after being down 70%, Unity 12.5% and TTD another 10%. "If you are trying to catch bottoms, you are getting manhandled." Palantir had good earnings but looks like a head top in a distribution cycle, and he sees Palantir and HOOD facing tough 2026 comps. "Price peaks before growth": Tesla peaked at 414.50 in 2021, two years before growth was cut in half in 2024. A Palantir growing 5% instead of 20–30% is worth less. Jensen is investing billions everywhere and the market still falls, so Amazon and Google earnings might just be one-day wonders. Apple's 11-point jump offset Nvidia's six-point drop. IWM continues to shine.
His best bet is cash while it resolves, with a few key shorts. He's shorting through futures and got stopped out on two or three attempts before the move finally broke. That tells him his edge isn't there, so "I need to step back and wait for my edge to return." On the silver shorts, he said a 38% move down that barely made money means the process was broken. Layering into ZSL would have done better, and the only easy money was knowing month-end Friday expiry would hammer it. He's not calling tops or bottoms. He's saying that with every move down in the range, the weakness in individual names gets worse, ServiceNow included. Space was bid, with Rocket Lab and ASTS up on SpaceX news. Down days cut "like a hot knife through butter" while up days grind, so a grind is the time to look for shorts. Plenty of news could break the range lower, whether war, Trump or a recession, and he doesn't know what would break it higher. His last word: stay on the sidelines, take stops, raise cash and deploy it when you have an edge. For investors, "almost everything looks so bad that it should be good."
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