Good morning, traders…

Since last Friday’s big pullback, many of the stocks I’ve been watching are cheaper than they were last week.

Names that looked extended on Thursday are now sitting at levels that were support weeks ago. 

Pullbacks have brought prices back to zones where buyers previously stepped in. 

The question is: how do you know when it’s time to bet on an upside reversal?

With the VIX rising and the slope getting steeper, you can’t assume old patterns will hold.

This is where Smart Money flow matters. When institutions start positioning at key support levels, when volume confirms buyers are stepping in, when internals show strength … that’s when the odds shift in your favor.

I’ve identified five names setting up for potential reversals. Each one is sitting at a key price level. Each one has Smart Money flow showing up. And each one could move regardless of what the broader market does.

If you’ve been sitting in cash since Friday, wondering when to get back in, these setups are giving you clues. 

Let’s Look At The 5 Charts I’m Watching This Week (And The Specific Levels I’m Waiting For)…

What’s Changed Since Friday?

Jerome Powell’s tone during his Tuesday speech was pretty dovish, flagging slower hiring and acknowledging he’s watching downside risks to employment. 

It sounds like he’s open to more interest rate cuts in the coming months. 

Meanwhile, volatility is creeping back. The VIX spiked as high as 22.94 before settling in the high teens — levels we haven’t seen since spring. When the VIX spikes above $16, I narrow my focus and raise my trade standard. 

Finally, the market Internals tell me something is brewing. On the S&P 500 chart, the 21 exponential moving average (EMA) crossed above the 100 EMA. 

That suggests there’s institutional support underneath the market. But with volatility elevated, expect sharper pullbacks. 

5 Names I’m Watching This Week

DraftKings Inc. (NASDAQ: DKNG)

DKNG trading volume has been strong in the $34.30 to $35 area. I’m watching a possible reversal off the base. 

If the price pulls back to $35.10 or below, I’ll consider the October 24 $35 Calls.

Airbnb Inc. (NASDAQ: ABNB)

ABNB has been quiet, but it’s trying to reclaim the point of control (around $124.50).

If it can break and hold above that zone, I like the October 31 $130 Calls. Create the alert above that line.

Rocket Companies Inc. (NYSE: RKT)

RKT stands to benefit from interest rate cuts, and the chart has found support near $16.

If it can drive above $17.30, I’m tempted to play the October 31 $19 Calls.

Sellas Life Sciences Group Inc. (NASDAQ: SLS)

Yes, it’s a low-dollar biotech. But check that base: a wide saucer forming right under resistance.

If it clears $2.20, I like the February 2025 $2.25 Calls. If that breaks, it could move hard.

Palantir Technologies Inc. (NYSE: PLTR)

PLTR is setting up nicely, but it needs to break $18.04. If it does, I’m eyeing the October 24 $19 Calls.

How To Avoid Overthinking

Traders have a nasty habit of looking for perfection when solid opportunities are staring them right in the face. 

Don’t overthink these trades. 

Do this instead:

• Use my scanners. Let Smart Money flow lead you to the right charts.
• Don’t chase. Wait for pullbacks to the support (like the 21 EMA).
• When you take a trade, have clear rules. Entry, target, stop.
• If price breaks out of your plan, get out fast. Cut it. Move on.
• Let your winners breathe. If the path is strong, give it room.

That’s how you know when it’s time to bet on an upside reversal.

Happy trading, 

Ben Sturgill

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