Alex's daily Market update & Focuslist - 01/31
Bad FOMC reaction + Alex's January results are in.
Good evening!
Well, FOMC & Jerome Powell’s remarks didn’t go as planned…!
We saw the worst-case scenario in the last hour when the market failed to bounce and broke structure down on heavy volume.
Knowing we’ve had one hell of a run since Nov., that I had mixed feedback in my recent positions, and that the broad market was exceptionally extended…this structure break on volume with today’s key catalyst is to be taken seriously, IMO. A multi-week pullback/correction would only be healthy and create exceptional opportunities. If that’s the case…we need to be patient as we closely follow PTMM to tell us the time to jump back in.
We also have a couple of red flags in the internals that we’ll have to watch closely tomorrow/Friday:
VIX potential structure breakout
Credit Spreads breakout on volume
10Y/yields breaking down.
DXY hammer
With all that said, I want to keep an open mind with the LT market still being in an uptrend based on price action & kma’s…and the fact that we often see FOMC day moves being reversed the following day.
I remain open-minded, but mainly on the sidelines and in a WAIT & SEE stance where I want to see how tomorrow & job data on Friday morning are handled before doing anything.
HAGN!
Alex ✌️
Alex’s PF performance. - Jan. 2024 📑🛡️
Monthly ( +17.74% )
YTD ( +17.74% )
It was a good month & and a good YTD start as I continued to execute my system well since last August. This cushion will allow me to be patient and wait for the next window of opportunity and the fat pitch.
I'm only one month into my new system addition about being more aggressive on the turn when the breadth & momentum are ST oversold (ideally, MT/LT are also aligned correctly). I want to continue improving on that concept for the next 2 months before really evaluating the viability, but so far I like how I'm able to push EC easily and then protect those gains quickly. These 2 x 5-day ratio windows we had in January were with an extended LT market and pretty weak, as we never reached higher than 2.23 when a strong opp. window could reach >+10 easily, so I am really looking forward to testing it out after a real pullback/correction.
On the execution side, here's my takeaway:
Very smooth EC with higher lows and limited drawdown due to my trimming and sensing when the market was tired last week.
Good RRR, but if I could limit my trading while PTMM is not ST oversold, then I could increase it even more. Work in progress.
Win are was within my avrg
I was able to cut losses short, that really helped me not getting paper cut between good buying run.
I did good with my stop trailing system using structure.
Overall, it was an excellent month and execution as I continued to build back my confidence following a rough 2023.
Cheers! 🍻
As promised, all trades with dates, entries, trims, exits in chronological order. Enjoy!
Tonight’s daily report content
PrimeTrading Market Model #PTMM + Takeaways
General Market Analysis: NASDAQ - S&P 500 - RUSSEL 2K - OTHERS, including my daily levels & my bullish and bearish scenarios
Market Internals
Sectors & Themes Analysis
Daily Focuslist including setups, alert levels & explanation (long & short)
Leaders list + Scans (technicals, fundamentals & potential TMLs)
My Portfolio Update
Economic Calendar
PrimeTrading Market Model #PTMM + Takeaways
Key Takeaways:
This is a bad reaction to FOMC today, with a proper distribution day.
distribution day, with GDB at -613 and daily_momo extreme readings
MCSI hooked down below the 10dma, never a good sign
We'll have to see how NNH reacts tomorrow, it always lag a day
Price confirmed the lower high, with a 1.71% down day below the 21dma.
Momentum:
5 & 10 day hooked back down today
MT_momo confirmed the hooked back down too while already being below 1.
LT_momo is the one to watch in the next few days/weeks imo. This market was stretched since Oct showed by a record of stocks being up +25% in the last 3M. That excess peaked at record high today. Will that reversal follow through and we begin a real PB/correction over a couple weeks...? that's the big question. Risk first from here is key!
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GENERAL MARKET ANALYSIS
S&P500 (ES_F)
We lost the recent range & 8dma on today’s fomc reaction. We are still above all kma’s & recent 4830 base level…but today’s power move on way higher than average volume is a red flag.
Let’s see if we reverse the move tomorrow (classic post-FOMC reaction right loll), and also how we react to important mega-caps earnings tomorrow & jobs data Friday morning. (what a week…!)
NASDAQ (NQ_F)
Same range break on NQ. We retested the 21dma and we bounce just above the recent base area. If we retest the recent range pivot tomorrow, I would probably initially see it as a short opportunity on the retest & rejection setup.
RUSSELL 2K (RTY_F)
The biggest disappointment is RTY/ small-cap, as we broke down from the 2004$ level very hard and even closed outside the range and right at the 50dma, ON VOLUME.
I’ll be watching the 21dma as potential resistance tomorrow.
That’s the move I didn’t want to see, and if we follow through lower and break the 50dma tomorrow…we could be at the start of a more extensive pullback/correction.
Market Internals
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