Here are the WEEKLY HEAT MAPS updated as of last Friday’s close: NVDA is the only stock overbought, Crude Oil is also very overbought but the Iran situation is a factor in that, so it could go higher.
Broadly speaking 50% prob. of reversal is where a transition starts to happen, from neutral to oversold or from neutral to overbought, however >50% is when the probability of reversal becomes good, the chance of a sudden reversal rises.
GC Futures, August25 expiry, this is the LONG model, mildly oversold as of last Friday, but it could be a valid buy-the-dip setup, the prob.of reversal is good enough for a buy the dip strat.
Crude Oil (CL NYMEX) futures, Aug25 expiry, peaked at 78.40 on Sunday, then came down, the model show that this market is very overbought. However, we all know the Iran geopolitical tensions/war can lead to much higher prices.
Short-term, there is a possibility for Crude Oil to pull back, but I would not bet the farm on that, this is a tail and should be handled with caution, WEEKLY BearCALLs can be a good instrument to trade, capped risk. PUTs will not work unless there is a large pullback but why would there be one? Chances are in favor of a small pullback followed by higher prices.
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