As I’m sure you are aware, CPI numbers came out this morning, and inflation is not slowing down.

That means the Fed has no reason to slow the pace of its interest rate hikes, either.

Until something changes there, this bear market is going to continue.

While long-only investors are panicking, I am eyeing up some fantastic trade setups.

In a bear market, there is big money to be made – if you know how to trade it!

I looked at every stock with a daily squeeze on the S&P 500 this morning, and I found two that have great setups – one long and one short.

Let’s dive in…

Action Plan:

Short Setup: RH (RH)

I like RH – formerly known as Restoration Hardware – short. Well, rather, I like the bearish setup. It has everything I’m looking for in a short – a bearish trend, a bearish pattern and a squeeze. What it doesn’t have – at least not yet – is a price level where I want to short. Below is RH’s stock chart with my notes. I’d like to enter short, and you can see my targets and stops. If we can rally to my entry level – between $250 and $255 – I’d like to enter the November 18 $250 puts. To see each chart in more detail, click the link below it.

Click to enlarge

Long Setup: Dick’s Sporting Goods (DKS)

For DKS, I like the setup to the long side. Instead of a bearish trend and a bearish pattern, we have a bullish trend and a bullish pattern, as well as a squeeze. So all three components are coming together in a bullish setup here. I’d like to use the post-CPI market weakness to buy a pullback in DKS. If DKS falls into the “buy zone” between $103 and $106, I’d like to buy the November 18 $110 calls. My entry level, stops and targets are noted on the chart below.

Click to enlarge

Make sure to check out the video above for a much deeper dive into both setups. And if you have any questions, please let me know by emailing me at feedback@monumenttradersalliance.com.

P.S. Karim has been pounding the table on the impact inflation will have on the economy. We saw that impact in today’s wild market ride. Most stocks are continuing to get hammered. If you are looking for a smart safe haven, he’s got a unique $3 asset that could be the best way to protect your portfolio. But you must buy BEFORE November 4. Click here to find out why.