Weekend Market Review: Tech Rebounds, Financials Falter, and Key Trade Ideas from ShadowTrader

Name: Buy These Three Stocks Now
Uploaded: 2026-01-24T13:19:13.003151+00:00
Channel: ShadowTrader
Description: Weekend Market Review: Tech Rebounds, Financials Falter, and Key Trade Ideas from ShadowTrader Introduction Peter Resc of ShadowTrader.

ShadowTrader

Jan 24, 2026

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4 min read

YouTube video ID: G71S576ih6Y

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Introduction

Peter Resc of ShadowTrader.net opens the weekend edition with a quick recap of the past week’s market action. A holiday‑induced gap on Monday, a sharp drop on Tuesday after a surprise Greenland‑tariff announcement, and a rapid reversal on Wednesday set the tone for a volatile but ultimately bullish finish.

Weekly Market Overview

Monday: Holiday, markets closed.
Tuesday: Large opening gap down after POTUS threatened 10 % tariffs on partners opposing the Greenland acquisition.
Wednesday: Tone shift – tariffs appeared unlikely, markets rallied.
Thursday & Friday: Relief rally continued; Intel guidance pulled the Nasdaq a touch lower, but the overall trend stayed positive.

Key Drivers

Greenland Tariff News – The initial shock caused a gap‑down, but the subsequent reversal acted as a catalyst for a short‑term rally.
HSC TWWB MCI Trade ("Hard Shell Corn Tortilla with Beans, Meat, and Cheese") – A tongue‑in‑cheek acronym coined by Resc to label the tariff‑related move; it quickly caught attention on financial news networks.
Intel Earnings – Slightly negative for the Nasdaq, but the impact was muted by the broader rally.

Sector Rotation: Tech vs. Financials

Late 2025: Financials dominated while tech lagged.
Early 2026: The dynamic flipped – tech shows relative strength, financials weaken.
Sector performance (Tue‑Fri):
Tech (XLK) – modest gains, breaking out of a long‑term downtrend.
Financials (XLF) – continued downtrend, no rally in the last four days.
Healthcare & Discretionary – solid.
Staples, Energy, Utilities – slightly down.
Materials – +3 % driven by gold’s near‑$5,000 level.

Market Metrics

Gold: Up ~8 % on the week, closing at 4,983.70 USD, just shy of the psychological 5,000 mark.
U.S. Treasury Yields: Fell back after an early‑week spike; 10‑year yield around 1.35 %.
Volatility (VIX): Down ~20 % for the week.
Crude Oil: +4 %.
Bitcoin: Stuck below 90,000 USD; 95,000 remains a key resistance.

Chart Analysis

S&P 500

Congestion zone 6,900‑7,000 dubbed the “2026 malaise.”
Gap‑down on Tuesday, followed by a Wednesday‑Thursday rally that held above the 8‑21 EMA.
Shock‑and‑Awe effect: overnight gap corrected by 10:00 a.m. ET, then a short‑term bullish bias.

Nasdaq 100

Similar congestion but slightly higher; the Friday bar sits above the downtrend line, indicating a possible tech‑sector hand‑off.
Key resistance around 25,873.

Russell 2000

Small‑cap rally earlier in the week, but a pull‑back on Friday.
Watch the 21‑EMA (~2,616) for a potential buying opportunity.

Sector ETFs (XLK & XLF)

XLK: Still in a long‑term downtrend but showing relative strength.
XLF: Continuing its 2025‑2026 decline.

Fed Outlook

CME FedWatch shows a 97.2 % probability of no rate cut at the upcoming FOMC meeting (Wednesday, late January).
Expected policy range: 3.50‑3.75 %.

Trade Review

Goldman Sachs (GS) Broken‑Wing Butterfly – Subscriber Dano sold a BWB (935‑945‑970 calls) for a $140 credit. With financials weakening, the trade is well‑positioned; price staying below 955 protects the credit. Verdict: Recommended.
Silver (SLV) Straight Butterfly – Subscriber Arthur bought a 85‑75‑65 butterfly for a $212 debit, expiring Feb 20. Resc warns of timing risk, low probability of rapid price movement, and erosion of the debit. Verdict: Not recommended.

Number‑One Draft Picks (Tech Long Ideas)

Ticker	Sector	Chart Pattern	Target Range
IN (Iron)	Data‑center	Rounded‑bottom cup, double‑top breakout	65‑70 USD
KOS (Katos)	Clean breakout	Flat base, first pull‑back – classic buy point	105‑120 USD
FIGR (Figure)	Fintech/Blockchain	Long base, early pull‑back, odd‑number move theory	80‑70 USD (initial), aim for 70+

Upcoming Economic Calendar (Next Week)

Monday: Consumer Confidence, New‑Home Sales.
Tuesday: UPS earnings (potential economic bell‑weather).
Wednesday: FOMC meeting (rates expected unchanged).
Thursday: Employment data, big‑cap tech earnings (Tesla, Meta, IBM, ServiceNow, Mastercard, Visa, Apple, KLA, Tenor).
Friday: Old‑economy earnings (American Express, Chevron, Exxon) + Core PPI.

Outlook & Takeaways

The market is still stuck in a congestion zone just above 6,900‑7,000 for the S&P and 8,200‑8,300 for the Nasdaq.
The tech‑vs‑financial rotation suggests a cautiously bullish stance on large‑cap tech, but the overall trend remains fragile until a clear breakout occurs.
Watch the 95,000 Bitcoin level, gold’s 5,000 barrier, and the 21‑EMA on the Russell for early signals of broader market direction.
Upcoming earnings and the FOMC will provide the next catalyst; expect volatility spikes around earnings releases.

Final Thoughts

Peter Resc wraps up by urging viewers to stay alert to the sector rotation, monitor the key technical levels, and consider the highlighted trade ideas. The tone is “cautiously bullish” – tech is waking up, but the market still needs a decisive push to escape the early‑2026 congestion.

The week ended with tech regaining momentum while financials stayed weak, gold flirting with $5,000 and the Fed likely holding rates steady. Traders should focus on the emerging tech‑sector strength, keep an eye on the S&P/Nasdaq congestion zones, and use the highlighted trade ideas as a guide for the volatile week ahead.

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a touch lower, but the overall trend stayed positive. ### Key Drivers 1. Greenland Tariff News – The initial shock caused

gap‑down, but the subsequent reversal acted as a catalyst for a short‑term rally. 2. HSC TWWB MCI Trade ("Hard Shell Corn Tortilla with Beans, Meat, and Cheese") – A tongue‑in‑cheek acronym coined by Resc to label the tariff‑related move; it quickly caught attention on financial news networks. 3. Intel Earnings – Slightly negative for the Nasdaq, but the impact was muted by the broader rally.

100 - Similar congestion but slightly higher; the Friday bar sits above the downtrend line, indicating

possible tech‑sector hand‑off. - Key resistance around 25,873.

congestion zones, and use the highlighted trade ideas as

guide for the volatile week ahead.

Helpful resources related to this video

If you want to practice or explore the concepts discussed in the video, these commonly used tools may help.

Technical Analysis For Dummies Paperback Recommended

Provides clear fundamentals of chart reading and pattern recognition, helping traders apply the shock‑and‑awe concepts discussed in the article

Amazon →

Options Trading Strategies: The Complete Guide Kindle

Explains broken‑wing butterflies and other option structures, directly supporting the trade reviews on GS and SLV

Amazon →

Gold Bullion Coins 1 Oz American Eagle

Physical gold allows investors to benefit from the near‑$5,000 price level highlighted in the market recap

Amazon →

Silver Bars 1 Oz Pure Silver

Provides a tangible way to gain exposure to silver after the discussed bearish butterfly trade on SLV

Amazon →

The Little Book Of Common Sense Investing Paperback

Offers a solid foundation for long‑term investors navigating sector rotations between tech and financials

Amazon →

Links may be affiliate links. We only include resources that are genuinely relevant to the topic.

Summarize another video

Full Transcript YouTube

Good evening and welcome once again to
another weekend edition. My name is
Peter Resc from shadowtrader.net. Great
to be with you once again. All over the
place week on this shortened week.
Monday was a holiday where we had a
large opening gap down on Tuesday due to
the tariff Greenland news which then
flipped itself the next day. A little
bit more on that later, taking the
markets back up to that no man's land
that the S&P and NASDAQ have been in for
most of this short 2026 thus far. All
right, we're going to show you what that
looks like on the charts. I'm also going
to get into a lot of trade ideas in this
show because I've got a should I do this
trade segment with two different
actually options ideas that we're going
to analyze and I've got number one draft
pick where instead of one stock I've got
three. All right, so all that and more
in today's weekend edition.
Let's take a look back on some of the
dynamics that define this week in trade.
Most notably a flip, if you will, in the
relative strength, relative weakness
between technology and financials. We've
been seeing for a while uh late in 2025
the financials were really ruling the
roost and kind of rallying really hard
while tech was sideways to down. That
dynamic has now flipped a bit uh in this
new year of 2026. So let's get into
that. But first let's take a look at
what's going on with ruling reasons.
These are the things that were really
driving price action this week. Uh
remember Tuesday the market was closed.
This news here on Tuesday actually came
out over the weekend. POTUS threatened
10% tariffs on any trading partners
opposing Greenland acquisition. The
market did not like that on Tuesday
morning. But then on Wednesday, we had a
tone shift, right? It all kind of
flipped. Tone shift on the Greenland
tariffs. And this here is an acronym
that I made up just to clear up what
this is. This the HSC TWWB MCI trade,
also known as the Hika Wubam key or
something like that. regardless. But
this we coined because obviously at
Shadow Trader, I've been doing this like
20 years now. And we always try to
really not politicize anything and just
stay away from that as much as possible.
Obviously, we've got all kinds of
different subscribers. Everybody's got
their own opinion on everything. So, I
coined this phrase basically here, this
acronym, if you will, because I thought
it just rolls off the tongue really
easily and it's easy to remember what's
going on. That basically stands for hard
shell corn tortilla with beans, meat,
and cheese inside. And I know, you know,
it might take a little bit of getting
used to, uh, if you will, but I think
that everybody's going to glom on to
this very soon, and you're going to see
CNBC, Bloomberg, every they're going to
be talking about this trade. So, that's
kind of the new, uh, acronym. Anyway, on
Thursday, we had the follow-on strength
from the prior sessions relief rally,
right? The relief that that tariff
situation was not going to happen and we
rallied then. And on Friday, guidance
from Intel took us down a little bit.
But here's what's important. Semi's down
a bit, but GAP doesn't hold. And that is
very important because you want to carry
forward that type of information in your
narrative. Whenever you have an
overnight gap that really does nothing
but ends up rallying the whole day, that
tells you the type of selling that was
going on with just knee-jerk overnight.
And all that was happening was a
reaction to those Intel earnings. NASDAQ
futures were down a little bit more than
ES obviously on that, but then we
rallied anyway. All right, let's take a
look at some numbers here on the weekend
review. So big focus here obviously is
on the tech and financials. Look at how
they're split. This is what I'm talking
about. How that dynamic shifted all of a
sudden where it was opposite late last
year where we saw financials leading so
much and tech was weak. Now the dynamic
seems to have flipped. Obviously
positive on all three averages here for
the week starting from Tuesday to
Friday's close. Uh healthcare and
discretionary were solid. Uh staples
energy utilities defensive were a little
bit down. Makes sense since markets were
up. Materials had a great week up over
3% mostly on the heels of gold because
if you look over in the far right of
your screen almost an 8% gain in the
yellow metal and we almost tagged the
5,000 level. We were closed at 4983.70
on Friday. So we're pretty much like
almost there and it's really just been
kind of like a straightup move. the
tariff situation and the Greenland
kurfuffle if you will that helped a lot
right when that was going on starting in
the beginning of the week coming into
Tuesday after the markets reopened that
really helped to push gold really quite
far right all right yields came down a
little bit bonds were interesting
because notice that that number tells
you 1.35% remember all of this stuff
behind me is measured from the Monday
open to the Friday's close in this case
of course the Tuesday open but it's
interesting that the bonds bonds were up
if you measure it that way because the
bonds actually started the week quite
down. Remember once again the whole
tariff Greenland situation the market
did not like that and you saw this huge
uh yield increase across the board
everywhere. sovereign yields basically
went up around the world. Obviously,
yields up, price down, but that didn't
last. Those those down prices were
really just on Tuesday and we kind of
spent the whole rest of the week
rallying as yields came in a little bit,
which makes sense because as that uh you
know, ha, whatever you call it trade,
you know, kind of chilled out.
Obviously, the situation just kind of
flipped. All right. Uh volatility also
down about 20% on the whole week from
the top to bottom. Obviously, you start
high and you end low. you get that and
crude up about 4% and Bitcoin had yet
another junky bad however you want to
look at it week ending under 90,000 and
once again that 95,000 level still
continues to be the key level that the
market can't seem to get over and even
with the rally in equities which would
have made you feel like it was more of a
riskon situation it did not bleed into
or help Bitcoin at all which is somewhat
of a sign of weakness I think because
generally Bitcoin has been acting like a
risk on asset a lot and with the markets
kind of firming up this week, you would
have thought we would have had something
on that front, but nothing yet on
Bitcoin. So, keep watching that 95,000
level to see if there's going to be any
type of a buy trigger anytime soon.
All right, let's check in with our broad
market charts like we do every week in
our what's really going on section
because obviously that is what's really
going on. Not a lot of fundamental mumbo
jumbo on this show. You know, I hate
that stuff. It's not necessarily I hate
that stuff, but it's it's not the
market. the market is price action.
Price action is in the charts and the
dailies of the S&P and the NASDAQ 100
are really what matter the most. Let's
take a look at those charts right now if
we could. So, moving along over here,
trend line obviously here was broken.
This is the key area here that I want
you to focus on. All this congestion
here, which is 6,900 to almost 7,000.
This is very very important because this
is what I call the 2026 malaise, if you
will. Right? We we were stuck in that
level. The market basically did almost
nothing. Right around here is where the
year started. We were doing nothing,
going nowhere fast. And then you had
this big drop. This is the Tuesday drop
on the tariff Greenland news that was
over the weekend. And then here, right?
Look at the shift in tone right off the
bat somewhere about right there. Change
in tone. Tariffs are off, not happening,
etc. Market rallies hard, comes up to
the 821, backs off just a little bit,
and then we spend Thursday, Friday going
backtoback dogeis, very, very small
bodies. I think going forward that right
there is bullish. I was talking about
this a lot in my trading room over the
course of the week talking about the
dynamic of what we call shock and awe.
Shock and awe is really really an
important concept. Shock and awe is a a
term that I came up with to talk about
how morning traders feel when they wake
up and the position or the market is in
a place that is so marketkedly different
from what they were expecting to get or
what they had the day before. So think
about it. Let's say you have a market
that closes very strong near the top of
the range. The next morning you gap down
very very sharply and you might even be
outside of range below that whole day's
range. That would be a classic example
of shock and awe because all of these
people are basically dead wrong who
finished the day prior. They then need
to switch their position up. Right?
Usually in the mornings what you'll have
is you'll have a rally off of that
because you have inventory correction
because the overnight players will be
overly short and then you start to watch
very very closely what happens to see is
there going to be new money buyers at
those levels or is it going to be that
all those longs that have the poor
location prior day are going to be
liquidating and you have this pushpull
between time frames of the long term and
the short term. But there's also shock
and awe in the longer time frames. If
you just forget about overnight
inventory, forget about overnight
traders, forget about the futures
market. Just think about these candles
here, which only represent regular
trading hours activity, right? There's
nothing 24 hours about this at all.
Correct? This is strictly cash market
action. This is what matters. This is
where the rubber really hits the road.
These are the 500 stocks in the S&P 500
right here. Right? So this is a classic
example of how shock and awe can happen
even on the larger time frame. And the
reason I mention this specifically is
because when you have shock and awe
coming into a day and that shock and awe
has to do with the overnight futures
gap, that shock and awe is generally
worked out or will work itself out by
about 10:00 a.m. Eastern or 10:30 a.m.
Eastern. Right? whatever is going on
with the inventory positioning of those
players, it's going to rebalance within
the first 30 minutes to an hour. But
when it happens like this on a longer
time frame, it's not so quick. There's a
lot of people stuck in here at different
levels, different inventory positions,
etc., right? And it takes a little bit
of a while. And that's why I think that
it makes perfect sense that once we had
that change in tone on Wednesday, we
rallied up the next day here on
Thursday, Friday. Thursday was actually
a gap higher and that gap held. Notice
that it didn't rally from there, but it
just made a dogee and held those high
prices. And I think that's important.
And Friday did the exact same thing. So
to me, this is one short-term bullish,
and two, I think that the shock and awe
isn't over. You still may have people
that are caught short here, especially
because you're still in a downtrend. And
there's still going to be people of a
longer term
timeframe outlook, if you will, who may
still be thinking and probably should be
thinking, hey, you know what? The
downtrend hasn't broken. Nothing's
really changed. I'm not covering these
shorts until we break here, say 69.50 or
something like that, right? So, if you
can really get yourself into the head as
much as you can of everybody else, that
will help you so much in your trading.
Always be thinking, no matter what,
who's happy? Who's sad? Right? Who's
long? Who's short? Where are they long
from? Where are they short from? How
much? Is it just overnight players? Is
it RTH, regular trading hours players,
etc., etc., right? The psychology of
everybody else is really what drives the
price action in the entire market. All
right, let's move on to the NASDAQ 100
right here. Right off the bat, you can
see it's a very different chart.
Obviously, we've been talking about late
2025. Technology was lagging financials
a lot, etc. And that's caused this chart
to look different where you don't have
the classic lower left to upper right,
right? It's not as high. This area here
of congestion is a little bit longer
than the one in the S&P. You had the
trend line break. Same situation
obviously on the tariff news. Gap down
and then move up. And here again, you've
uh started to sit right above that 821
EMA. But here's the rub. Notice that as
that dynamic shifted over the course of
this week where money was coming out of
financials and into technology, look
what it did to the NASDAQ 100 where
Friday's bar is in relation to the
downtrend line. It's not underneath like
we just talked about in the S&P. It's
actually above. So that you know that
sort of change in tone passing of the
baton if you will of that tech over uh
you know out of financials and into
technology that's what's helping this
NASDAQ right so we'll see if that can
get a bit higher and obviously you've
got this peak here that needs to clear
around 25873
but we'll see for now a little bit
stronger in the NASDAQ and that's kind
of how you want to be positioning
yourself right you want to be looking at
the fact that the uh dynamic has shifted
a little bit and maybe big cap tech is
staging a little bit of a comeback let's
check in with the Russell 2000 only
because we did last week. So, just to
kind of maintain some continuity here
and if you recall last week, we talked
about the Russell rally potentially
being detrimental to the rally of
everything else because it really is a
lot of junk stocks. And that is typical
of lateage bull markets where lower
quality issues rally while higher
quality issues stumble. And this week
obviously we saw somewhat of a reversal
of that trade, right? Uh at least
especially late in the week. I shouldn't
even say this week because it was still
going up uh Tuesday, Wednesday,
Thursday, and Friday. Then was uh a move
down, but keep an eye on it. I mean, I
think that if we continue to have a
bullish tape, if that S&P and NASDAQ do
definitively get over those trend lines,
probably the Russell is going to move
with it. So, we'll see if there's going
to be a pullback buy somewhere there. I
would keep an eye on that 21 EMA to be
honest with you. That's 2616
level. That potentially could be a buy
in the small caps.
You can probably guess what we're going
to talk about in this week's sector
spotlight segment. We're going to just
look real quick at the XLF and the XLK,
right? Obviously, because that was the
most important dynamic of the week was
the changing of the guard, if you will,
where technology kind of stepped it up a
little bit and financials pulled back.
So, I want to show you these two daily
charts, if you will, which is XLK and
XLF. The ETFs obviously that represent
those two big sectors. Starting with
XLK, right? This price action right in
here. This is obviously the uh the week
that we just had where we rallied. We
gapped down on Tuesday and then we
rallied. Now overall, this is important
to note. We haven't really gotten out of
this malaise, right? I mean, obviously
this is a huge consolidation level.
Downtrend line is still very very much
intact and we haven't broken out of
there. We're just starting to see some
relative strength come into this segment
this week. So, we're going to see we're
going to kind of monitor this day by day
and see if this can continue and we can
get it higher. I think if we can get it
higher, especially being that this is
the largest representative in the S&P,
about a third of the market, we'll see
if that helps to lift the market higher.
Right? Financials, as I was saying, this
is the action here of late 2025.
Correct? And then notice what the action
was down here of just the last four
days. There wasn't any rally at all,
right? You didn't have that upward
movement and it just continued on the
trajectory that it had from late 2025,
started coming down a bit, or I should
say early 2026. I apologize. uh that
same trajectory from early 2026 as it's
just been coming down the whole time as
financials have been selling off. So
keep all of this in mind. These two are
very very important. Obviously they're
the two largest sectors uh in the S&P uh
together combined. This is almost like
half the market. But again, watch this
dynamic very very closely in the days
and weeks to come to see if it
continues.
Fed watches a little segment that we do
here on the weekend edition. whenever
we're coming close to an FOMC meeting
and we've got another one coming up.
Time flies. It's every single six weeks
is when we have a meeting and we are
slated to have another meeting in next
week which will be Wednesday at two will
be in the announcement in the last week
of January. Main takeaway here on the
Fed from the Fed watch tool from the CME
here is simply that the odds of no cut
are almost 100%. It's 97.2%
that we're going to stay at the current
target rate of 350 to 375. And if you
look all the way down here, it's less
than a 3% chance that anything is going
to change. So, the Fed has been pretty
transparent. Uh, as of late, these Fed
fund futures are usually pretty spot-on.
So, I'm not expecting any movement at
all on Wednesday in terms of interest
rates when the Fed convenes.
Time now for one of my favorite segments
that we don't do that often. We haven't
had a should I do this trade in a little
while. This is a little game, if you
will, that we play in my trading room.
room, the weekly options room, where I
ask subscribers to give me an options
trade and then I analyze it and I tell
them basically if they should or
shouldn't do this trade and this week
I've actually got two for you if you
will. So let's take a look at the first
one right here. First trade is coming
from a gentleman named Bookham Dano. is
one of my subscribers and he wants to
buy a butterfly on GS for next week
which is the JN30 expiry and with
strikes of 935 945 970 on the call side
and you notice here where it says at
minus140 limit that means that he's
receiving a credit for the trade he's
buying a butterfly but he's getting a
credit for it because it's a broken wing
that's one of my favorite strategies and
I've always said this is really the far
superior strategy for collecting credit
rather than selling naked or doing
verticals. I do those two, but if I had
my choice, I would go with the broken
wing butterfly every time. So,
obviously, he's receiving a credit here
of A140. Why? Because if you break up
the structure here, you can see very
closely that the long vertical in the
front is only 10 wide, 935 to 945, but
the vertical in the back is 25 wide,
which is short. He's short the 945970
call vertical. And when you put that
together, you get the BWB at a$140
credit. So let's take a look at the
chart. At first glance, I think this is
a good idea because if you recall, we've
been talking a lot in the beginning part
of the show how financials are weak. So
right off the bat, we would imagine that
there's propensity for Goldman Sachs to
move lower with the rest of the sector.
And if you have a call BWB for a credit
somewhat higher, right? It's kind of the
same thing like as if you had sold a
call or sold a call vertical. You bought
a broken wing butterfly for a credit.
Ideally, you would want the market or
the stock to move away from that
structure so that you collect that big
credit. Especially when you know right
off the bat that he got a$140 for the
trade. See, that's how you know that the
individual is trying to collect credit
and is not using the broken wing
butterfly as a structure for a
directional trade, which can work as
well. These are concepts that I teach in
my weekly options room all the time
where sometimes you will buy a broken
wing butterfly for say 5 cents or even
money or the market might give you a
five or 10 cent credit. In that type of
trade, you're not doing it for the
credit. You're doing it because you're
trying to create a structure that's
going to expand as the market slowly
moves into that structure. But this is a
different scenario. Obviously with
the$140 credit, Dano is looking to
capitalize on GS moving lower. So, we've
got financials moving in that direction
already. And here I've annotated the
downtrend line in GS where we're at now.
This is Friday's action that moved
pretty marketkedly lower. As a matter of
fact, by the end of the day, there was
nowhere near a$140 credit still in this
trade. So, if you look at this now, he's
already got most of the profit out of
this because he had uh given me this
idea earlier in the day, but I think
it's still fantastic from an educational
standpoint because there's so much to
unpack with this trade. So, you've got a
downtrend. And I drew this little box
here purposely because that box is
essentially the area where even if we
rallied and price went into that area,
the spread would still be fine.
Remember, he's in a 935, 945, 970 BWB,
broken butterfly, if you will. So, in
that structure, where does that trade
actually get in trouble on the upside?
The answer would be 955. So this box
represents price level of 935 to 955
where he's going to be okay even if
price goes into that box because
obviously at 55 is the level where it
would be a straight butterfly and
because it's not he's not long until 70
the trade will start to lose money. So I
love the structure. I love the credit. I
like the fact that if you look at where
that box is right
the mid strike here of the butterfly
which is 45 right is actually slightly
above that level. So, he's even got the
short kind of back behind the trend
line, which is what I really like. So, a
lot to like here. Good trade idea.
Bottom line, I would do this trade.
Let's look at another one, if you will.
This is another subscriber sent me this
as well. This is on silver, and I
thought it was a great one to talk about
because obviously the metals are just
absolutely on fire. We've got $100
silver and we've got $5,000 gold
basically happening right now, right?
So, this is a bearish idea, if you will.
Uh, coming to us from a gentleman named
Arthur. And he said, "What if I buy a
butterfly on silver going out to the Feb
20 expiry, okay? And I want to buy an
857565."
So, in this case, it's a straight
butterfly, correct? Because there's
equidistance between the strikes, right?
He's buying a straight fly and he wants
to pay $212
debit for it. Okay? And I drew a box
here basically from 85 to 65 because
that's the profit area of the trade. So,
do I like this trade? Honestly, my
answer is no. I understand what the ini
individual is trying to do. They're
trying to capitalize on a potential move
down in SLV if
spot silver, which is at about a 100
bucks. Obviously, this is the ETF, so
it's not exactly one. You see it at 93
here, but he's trying to capitalize on a
move potentially down away from the $100
level in silver. Why don't I like this
trade? I think a lot of newer traders
who come to the market would look at
this and say, "Oh, this is a great idea,
right?" Because they mistakenly think
that the market has a sense of gravity
to it and it doesn't. Okay? We
experience gravity all the time in the
real world and we should be thankful for
it because that's what keeps us
grounded, uh, if you will. But there's
no such thing in the markets. There's no
such thing as gravity uh in the markets.
Meaning that this doesn't have to come
down. It can go higher or it can
consolidate by time and not price. And
when that happens, that $2 premium that
was purchased looking for the move into
this box is going to slowly erode. Okay,
that's scenario number one where price
doesn't come down. Scenario number two
to me is just as negative because
using the butterfly structure and going
all the way out here to the 20th of
February which is a month away that to
me is not a good idea because complex
structures like this will not expand in
your favor until you're much closer to
expiry. So this trader is not only
putting the onus of direction on himself
that he's got to be right on direction,
he's got to be right on timing because
if gold falls in or excuse me, silver,
if silver falls into the box very
quickly, meaning early next week or one
week into the trade, he's not going to
get too much bang for his buck for the
$2 that he put out. It might expand to
maybe $3, but nowhere near the $10,
which is the max value of the spread.
Because in a butterfly structure, that
sort of expansion closer to that $10 max
value is only going to happen late in
the cycle, like in the last week of the
trade as you get close to that February
20th expert. All right, so for those
reasons, I don't really like it. I don't
think it makes sense to put out the uh
$2 debit looking all the way out to
February 20th. For me, I would not do
this trade.
Let's get into some trade ideas this
week. This is a segment that I like to
call number one draft pick because it is
where I give you my top idea for next
week. Show you a chart that I think is
going to have some movement. And this
week is kind of special because I've
actually got three ideas to present to
you and they're all in the technology
space going with the theme of that tech
could be waking up again and maybe
getting a little bit more bullish. So,
you're going to want to look at these
three names here. Let's take a look at
what I've got to offer this week. It's
going to be Iron, Kattos, and Figure.
Those are the three stocks that we're
going to talk about here for the number
one draft picks. Let's get into some
charts. Look at the first one here. This
is Iron, okay, which is in the data
center space. A couple of peaks here,
uh, sort of fallish of 2025
coming down. First thing I like is the
rounded bottom. This bottom is very
rounded, if you will, kind of like a
cup. And I know that I've got clearance
from this 57 area back up to the high,
which is almost 77. I kind of liked how
Friday's action obliterated more or less
the three bars that were before it. I
call that uh sellers shut off. That's
another just trading term that I coined
a long time ago where you have bearish
bars, multiple bearish bars inside of
one big bullish bar. So there's kind of
like this big change of tone all of a
sudden on Friday. So I think if you lift
up over that level, notice also that
Friday's high is almost identical to the
high that was four trading days back
right there. So you got a double top
there. It's absolutely perfect. So
that's going to give you a very nice
long entry. I think you could easily
lift if the market's bullish probably up
into the 65 or 70 area. So that's IN is
the ticker. Keep that one on your radar.
Let's move over to the next one. This is
Katos, which uh ticker symbol Kos. All
right. very very clean chart if you
will, right? There's charts that are
clean and there's charts that are messy.
This is a chart that I would say is very
very clean. This is the type of chart
that when you have like technical
analysis textbooks and they tell you,
oh, you should buy the pullback. This is
probably what those charts look like.
And uh these are good ones to look at. I
mean, it's very very clean, right?
You've got very very flat base here,
break out of the base, huge expansion of
range, things start to accelerate and
now you're looking at literally the
first pullback after that level. Okay,
the first pullback is almost always a
buy because there's the FOMO of
everybody who didn't get in here early
enough and they're looking for that
second bite at the apple, if you will.
And that's what's happening now. So,
we've lost the eight, but the 21's
coming in and this is where I think
buyers are going to get a little bit
more active. 10550ish is the area right
now where the 21 is. I think the uh KTOS
should be a buy in this area and you're
going to be looking for a move at least
probably to about 120 because that would
be about half of that pullback move
there. All right, let's look at number
three here which is this chart here.
This is figure FIGR
which is in the fintech space blockchain
but what I love about them is they are
not doing anything with currency on the
blockchain. Okay, it's different from
that. Check them out. You can see what
they do. And it's a relatively new
issue. Okay, this stock has not been
around that long. They IPOed not that
long ago. Again, long base here, long
base, which is generally bullish.
Building up pressure and then you start
to break, right? Break up and then
balance up again. And this is pullback
again. And remember, if stocks are going
to stay in trend for protracted periods
of time, there are usually moves that
are measured in odd numbers. There will
be three moves, there'll be five moves,
there'll be seven moves, there'll be
nine moves. This is very early in the
stage, early in the game here. We're
probably in like the first or second
inning if the stock is going to keep
rallying because how many moves have you
had? One, consolidate. Two, that's it.
So, we're looking for that move number
three, which would be the odd number,
which would make sense. Trend line
support is going to be where it's at
coming in right now, right about 60.
Little bit of a reversal bar on Friday.
The stronger entry would obviously be
above Friday's high or just connect
these highs and wherever that downtrend
line of the pullback is, which is
basically above Friday's high. That
should give you a good entry point. And
again, minimum 50% of that level. So,
that's roughly 80 to 80 to 60. you're
gonna want to see a rally at least to 70
before you start peeling off some of the
profits on this one. All right, so three
solid ideas for you here. Three number
one draft picks all long and all in the
tech space for this week.
Let's wrap up with a little looking
ahead, if you will. Economic data and
earnings, which is super important next
week. You'll see in a moment when I'm
about to show you the next screen. Next
week is going to be a doozy as far as
big cap tech. Let's take a look at
what's going on here. So economic data
is the usual. Nothing major going on.
We're going to get consumer confidence
and new home sales on Monday. UPS is
going to report on Tuesday. That one
could be kind of important. Remember, I
only give you a few names, the ones that
I'm personally interested in, but also
the ones that I think could be market
moving. So UPS could be somewhat of a
bell weather for the economy. We'll see
what happens. That's going to be on
Tuesday morning. But here's where things
start to get very hot and heavy into the
back end of the week because FOMC
announcement is coming on Wednesday.
That as I was saying earlier is probably
the least of our concerns because we
already know they are not going to be
doing anything. Almost 100% chance that
rates are not moving on Wednesday. So
the whole focus next week is going to be
here on the big cap tech which is mainly
Tesla, Meta, IBM, Service Now and then
look at Thursday, Mastercard, Visa,
Apple, KLA, Tenor which is a giant in
the semiconductor space that's going to
matter a lot and Friday is going to be
more old economy if you will names which
uh American Express, Chevron and Exxon
along with some inflation data, core PPI
those are generally market movers and
then of course the usual uh employment
data which we always again on Thursday.
But really the big focus for next week
is going to be on that big cap tech. I
would say Tesla, Meta, Service Now,
Apple. That's going to be your focus for
next week. We'll see how it goes. All
this stuff is very very much market
moving and I think it's going to shake
up the market uh probably in a big way.
Watch very very closely especially on
the morning after. Tech always reports
in the evenings. The uh more traditional
stuff like financials etc. they usually
report uh in the mornings, right? So, be
aware when this stuff is hitting the
tape next week.
And that's my show for this week. Thank
you so much for spending a little bit of
your weekend with me. If you can
remember, please hit the like and
subscribe buttons. Does help the channel
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the markets. You can sign up for those
right on our homepage. All right, let's
recap a little bit of what we talked
about. So if you recall three weeks ago,
the title of this video was cautiously
bullish, right? And it feels like we're
kind of flipping back into that tone, if
you will, right? We've got divergence
occurring between financials and tech.
Tech is starting to reassert itself. I
think that the earnings next week are
going to be very very pivotal because
we're talking about the big tech uh
names in terms of fang, Apple's going to
be reporting Tesla, etc. That's going to
go a long way into telling us whether or
not technology is going to reassert that
dominance and help to get that NASDAQ
100, if you will, up through that choppy
area. Same thing with the S&P, right?
This is why I'm only cautiously bullish
at this point because we have rallied a
bit, but we've got all that congestion
just to the left of us where the market
hasn't really moved in uh January of
2026 and we're going to see if we can
chop our way up through that. All right,
so pay very very close attention to all
that stuff happening next week. All
right, on behalf of myself and the
entire Shadow Trader team, as always,
coming at you from beautiful Los
Angeles, California, I wish you good
trading and good night. Heat. Heat.