💥Week 47 | S&P Price Hits 50SMA AGAIN? |Seasonality Points to Big Moves!? | Cautiously Bullish Options Play

Hey Traders,

The stock market finished the week with mixed performance as investors navigated uneven sector leadership, mega-cap rotation, and Fed commentary that tempered December rate-cut expectations.

DJIA: +0.3% WTD

S&P 500: +0.1% WTD

Nasdaq Composite: -0.5% WTD

Russell 2000: -1.8% WTD

S&P MidCap 400: -1.2% WTD

Leaders: Health care (+3.9%), Energy (+2.5%)

Laggers: Consumer discretionary (-2.7%), Communication services (-0.8%), Utilities (-1.2%)

Midweek, tech-heavy sectors struggled. Yet, the DJIA reached a record close above 48,000, supported by financials (+0.1%) and industrials (-0.9%).

The S&P 500 Equal Weighted Index highlighted rotation beyond mega-cap growth, showing broader market participation.

Hawkish Fed commentary reduced the odds of a December rate cut to roughly 50/50, pressuring growth-oriented and high-beta names.

– Thursday: Broad-based weakness pushed the S&P 500 and Nasdaq lower.

– Friday: Partial rebound as chipmakers and tech stocks stabilized, helping both indices reclaim technical support above the 50-day SMA.

Overall, the week reflected a market balancing selective sector rotation against caution on policy and stretched valuations.

Source: Briefing.com

Historically, week 46 was a 50/50 scenario but ended bearish. This week, Week 47 shows a slightly higher probability of being bullish, with 60% chance up ~1.66% versus a 40% chance down ~-1.75%. Looking ahead, weeks 48 and 49 have historically favored bulls, with ~80% probability of being bullish, suggesting a strong finish to the month.

Source: Tradingview.com

The 50SMA continues to be a key level for entries and exits. For example, on 7th Nov, it triggered a long trade that exited quickly on RSI(2) hitting 70, locking in a solid profit. Last Friday, it triggered again—potentially another sweet spot.

Backtest rules were simple:

– Entry: Price touches but closes above 50SMA, go long

– Exit: RSI(2) hits 70

The backtest stats are impressive:

– Win Rate: 75.42%

– Profit Factor: 2.179

– Max Drawdown: 17.96%

Source: Tradingview.com

Depending on my focus, I might choose between a Long Call or a Bull Call Spread.

If I lean more on technical setups—price above 50SMA with RSI(2) exit, backed by the 75.42% win rate from the backtest—a Long Call could be make more sense.

If I lean more on seasonality (~60% bullish probability), a Bull Call Spread makes sense. This tightens my breakeven, lowers max loss, but comes at the cost of a capped profit.

Alternatively, if I want to increase probability, a Bull Put Spread could work. This benefits from the expectation that the stock won’t fall below a strike around 35 delta, offering a higher-probability trade.

So these are the key recap and setups on the table for the upcoming week. The market is showing selective sector rotation, technical setups around the 50SMA, and seasonal patterns that suggest potential bullish stretches ahead.

I will be keep an eye on key levels, sector moves, and RSI signals, and stay ready to adapt. What’s on your radar? Did I miss anything? Drop your trade ideas and insights below—always great to hear different perspectives and strategies.

⚠️ Disclaimer: This is for tracking my trades and strategies for personal review. Not investment advice — always do your own research and ensure it fits your risk tolerance.

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