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Something unusual just showed up in my scanner that I need to share with you.
After scanning almost 9,600 stocks, only 21 showed actionable technical setups — and the S&P 500 (SPY) sits at the top of that list. That alone is rare, but what makes this even more significant is that the Dow (DIA) and the Russell 2000 (IWM) are also showing extreme consolidation patterns at the same time.
I’ve been watching markets for a long time, and seeing three major indexes simultaneously pinched and coiled like this almost never happens. When it does, it usually means one thing with high conviction — a strong directional move is coming within the next 30 to 60 days.
The question isn’t whether a break is coming — it’s which direction wins.
The Setup That Has Me Positioned Both Ways
Here’s what we’re dealing with. SPY has been stuck in a tight range for weeks, hovering in the upper-$600s as price keeps compressing. The consolidation keeps tightening, the coil keeps winding, and the market is clearly waiting for a catalyst to push it out of this squeeze.
If we break to the upside and push toward the expected move near $720, that opens the door to higher targets. On the downside, a failure from this compression points back toward the lower end of the recent structure, where the next major support levels come into play.
This is where my Pinch Point strategy becomes valuable. When price compresses into a narrow zone, volatility drops and options prices become more favorable. That creates an opportunity to structure directional debit spreads with attractive risk-reward — even when the direction isn’t confirmed yet.
The beauty is that I don’t have to predict the breakout. I just need to position around it.
How I’m Trading This Without Picking a Direction
Rather than guessing, I’ve set trades on both sides of the expected move. I entered a debit spread using the $710 by $715 calls on the upside, and a corresponding put spread on the downside, paying $2.29 for the combined position after seeing price hovering near the $2.15 mark earlier.
If SPY makes the expected move toward $720, the call spread should deliver most of its potential value. If we break lower instead, the downside spread is positioned to capture that move. Either way, I’m aiming for returns in the 110-115% range without needing to pick a direction.
When SPY, DIA and IWM all compress like this together, the market usually doesn’t stay quiet for long. DIA is already showing clear accumulation and distribution characteristics, SPY hit the top of my pinch point scanner, and all three indexes are coiled tighter than they have been in months.
A big move is coming — and I’m already in position for it.
I’ll see you in the markets.
Chris Pulver
Chris Pulver Trading
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*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
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