Alex's daily Market update & Focuslist - 03/26
Market refuses to break down and MEGA-CAPS continue leading this market.
PrimeTrading is an equity swing trading community to learn & trade alongside experienced traders.
✅ See how I execute intraday while I share my trades live.
✅ Alex's daily market commentary, Portfolio updates, trade explanations, and daily FocusList.
✅ Share & Discuss potential trade ideas with a like-minded amazing community
✅ Talk Macro Economy, Cryptocurrencies & much more!
✅ Talk about mental game & psychology to evolve as a trader!
✅ Education & mentoring from Alex & experienced traders.
✅ Q&A zoom meetings
Improve as a trader with a risk management first approach while working directly with me intraday.
Alex 🛡️✌️
GENERAL MARKET ANALYSIS
NASDAQ (NQ_F) Daily
I’ll be tracking NQ_F as my reference index due to its clear-leading action.
Price Action Analysis:
NQ_F retested the 12801$ base level and followed through on Thursday's bounce attempt. With that second rejection and inside day, I’ll be looking at a DTL breakout and 13082$ pivot to confirm an upside continuation.
The fact that we did not follow through on FED’s failed breakout attempt is very constructive and greatly reduces the breakdown probabilities for the short term.
NQ_F is above ALL KMA’s - uptrend.
On the upside (bullish scenario),
We have to reclaim FED’s high pivot at 13082$ to confirm continuation.
On the downside (bearish scenario),
As long as we stay above 12578$ base level, we must assume it’s healthy pullback action.
S&P500 (ES_F) Daily
RUSSELL 2K (RTY_F) Daily
Alex’s TAKEAWAYS
The market refused to break down & to follow through on the FED’s reversal. On both Thursday & Friday. We even bounced and reclaimed the 3964$ level & kma’s on ES_F that I was watching closely for my bearish scenario. Due to that reason, I covered my short positions and switched back to a neutral/cautious bullish view.
We still have very mixed signals right now,
Market breadth remains very weak (NYSI/NYHL)
We see this market being lifted by a handful of names, mainly the mega-caps
The mid/small cap stocks that show promises and breakouts can’t follow through on their move.
This divergence in the mega-cap is there, and like in 2021, it can last many months. So why not take up this opportunity and use our technical analysis skills to trade these highly liquid names that act super well and buck the trend? They are trading well, and their price action seems very predictable.
They are lower ADR, so by using the same % risk, we could use a larger position size and focus on these mega-caps to play the market. Notice how semis got crushed Friday, even if they were the clear leaders of the last few weeks. So even if you are in the right stocks & sectors, these sharp rotations, as we saw in 2021, could also be hard to handle.
So I will focus mainly on these names in the next days/weeks, make them my cores, and update them in the daily letter. At the same time, I’ll add some performance boosters in higher ADR names as the breadth turns and our ST & IT_SIGNALS confirm wide market participation and a good trading environment.
Here are the names I’ll focus on:
You’ll see a new format for the FOCUSLIST to reflect this adaptation, with three categories with different types of plays that I will focus on going forward.
LIQUID LEADERS (MEGA-CAPS)
SMALL/MID-CAP STOCKS (PT UNIVERSE LIST)
INDICES TRADES
Regarding market breadth, we know $QQQ has led in the last few weeks, mainly because of its mega-caps constituents. This could be seen by the lagging PA on $QQQE (equally weighted ETF).
Following FED's DTL rejection, we could not break down and hold the kma's and the structure area. I am also noting the selling exhaustion in the volume profile. If we see a breakout of this wedge this week, we could see a breadth expansion and wider participation in this narrow market. To be seen, but constructive!
Bottom line:
The market refused to break last week when it should have; that’s a very constructive sign for me.
We also see ST breadth being still oversold & extended with basing action.
Mega-caps that led recently is setting up nicely from base retest patterns. (MSFT, AAPL, TSLA)
The market breadth remains weak, and we don’t see enough individual stocks follow through on their breakouts—still a hard penny market.
ST breadth is quite extended and shows nice basing action.
The indices bounced nicely on Friday, creating a potential WBPB setup on ES_F, U&R on RTY, and BORS on NQ_F. If we see follow-through, it would be very positive.
For these reasons, I will shift back to a neutral/very cautious bullish view of this market, but be very cautious due to the bad breadth with a FOCUS on the mega-caps until we see a real turn.
Market health & Trend indicators:
IT_SIGNAL (NYHL): downtrend (red) + BELOW 50dma = INTERMEDIATE-TERM DOWNTREND (🟥)
ST_SIGNAL (NYSI): downtrend (red) + BELOW 10dma = SHORT-TERM DOWNTREND (🟥)
Tomorrow's economic news/events:
GAME PLAN:
I will focus on the LIQUID LEADERS FL tomorrow and look to engage one of those names if I have an alert.
As usual, using progressive exposure to ensure I finance my next position’s risk with my first position profit open profit!
FOCUSLIST
LIQUID LEADERS (MEGA-CAPS)
SMALL/MID-CAP STOCKS (PT UNIVERSE LIST)
INDICES TRADES
What do you think of this new approach/focuslist format? Leave a comment and/or answer the quick poll below. Thx!
LIQUID LEADERS (MEGA-CAPS)
NVDA & META are extended for me and confirmed by the charts. The focus for me this week will be TSLA, MSFT & AAPL. Strongest of all, not extended, and shows PT technical setups.
MSFT (BORS) - Alert: 283.33, SL: 275.28 / LOD
Been holding well the 270/275$ base area and the 5dma last week. We are setting up for a BORS setup this week if we can follow through with a higher high breakout.
AAPL (BORS) - Alert: 162.14, SL: 157.68 / LOD
Another leading mega-cap that has been showing a lot of strength last week and surfs above the 5dma. We held the 155/157$ base area and set up a BORS setup if we can reclaim the recent swing high pivot.
TSLA (BORL) - Alert: 198, SL: 187.15 / LOD
After Jan/Feb. move, we've been consolidating above the 50dma. We reclaimed all kma's and 180/190$ base area and retested those levels late in the week. I like the odds of this BORL setup if we can hold & push above that DTL.
SMALL/MID-CAP STOCKS (PT UNIVERSE LIST)
My focus is on the LIQUID LEADERS until the conditions improve. But I will continue to share the results of my scans for you guys that want to focus on these names. It will also provide me the feel of when I will begin to play again these stocks.
FSLY (WBPB) - Alert: 16.34, SL: 15.49 / LOD
After the BO21PB setup breakout, it consolidated in a very tight range right at the 5dma and below the swing high pivot. If we can reclaim that 16.34$ pivot, we could see a continuation higher.
LNTH (BO10PB) - Alert: 83.82, SL: 78.55 / LOD
Following the power earnings gap (PEG), it broke out from its base 2w ago and pulled back to the 10dma in a tight channel and low volume last week. If it can breakout from that DTL & swing high pivot, we could see continuation higher.
INDICES TRADES
NQ_F is showing constructive action, but I will rather wait on a 10 or 21dma to look at a potential TQQQ trade.
PORTFOLIO UPDATE
100% cash
INTRADAY/CLOSED TRADES:
SECTORS PERFORMANCE
Leading sectors:
SMH Semiconductors
Still building nicely above WB b/o pivot high and around the 257.20$ level. Looks healthy to me
FDN Internet
It held the 10dma and 141.19$ level again on Friday, we are still in that channel and showing constructive action.
IGV Software
Still inside Wednesday’s FED range and holding the 5dma and building nicely right below the 293.41$ base level.
TAN Solar
Followed through on Thursday’s big rejection, held the 71.75$ level, and closed above the 5dma.
XBI Biotech
It was unable to break that 72.55$ level again on Friday, but we are still below all kma’s and in a downtrend. This week should be interesting.
XLE Energy
We broke below the 76.78$ level on Friday’s open but quickly reclaimed the level and closed back inside the base area. This creates another higher low, but we remain below all kma’s and a downtrend here again.
XME Metals & Mining
Held the 48.75$ level Friday on a gap down and was able to push above the 5dma and close with another higher low. Still below the 10/21dma and in a bear flag, so a lot to prove.
XRT Retail
Held the support area on Friday, but remains below all kma’s.
MARKET BREADTH & INTERNALS
$NYHL (Cumulative new 52W Highs/Lows & 50dma)
We remain in a downtrend below the 50dma.
IT_SIGNAL: downtrend (red) + BELOW 50dma = INTERMEDIATE-TERM DOWNTREND (🟥)
$NYSI (McClellan summation index & 10dma)
ST_SIGNAL: downtrend (red) + BELOW 10dma = SHORT-TERM DOWNTREND (🟥)
$NYMO (McClellan Oscillator - Breadth extensions)
Another higher low, can we make a HH now?
NNL accelerated on Friday. Breadth remains very weak.
NYAD (NYSE Net Advances/Declines)
Weak positive thrust on Friday.
NYUD (NYSE Advances/Declines volume)
U/D volume with a double bottom setup.
$NYA200R (Stocks > 200dma - LT breadth)
Still in basing action. The breakout from either side will give us MUCH information about the potential market direction. Stay tuned.
$NYA50R (Stocks > 50dma - MT breadth)
Same basing action. The next move will be significant.
$NYA20R (Stocks > 20dma - ST breadth)
Same basing action. The next move will be significant.
Big second rejection at the 25$ level on Friday. We also closed below the 5/10/21dma. Let’s watch the 20/25$ range breakout to have a good idea of the market direction.
Still in a downtrend. I’ll watch the 50dma & 103.58$ level as potential resistance.
We gapped down above the 1.62 level on Friday but could not tick higher at the open and finally faded all day to close below it. We are still in a solid downtrend and indicate to remain very cautious, but that false breakout is a constructive first step.
After a sharp decline, we finally held the 3.30% ish level and closed in the upper range. We are still in a downtrend below all kma’s.
ECONOMIC & EARNINGS CALENDAR
PRIME MODEL SPREADSHEET (PT_database)
Access to the PT_database 👇
LEADERS LIST
Overall leaders (PRIME Score)
FRO,ALGM,ELF,ANET,AEHR,ONON,FSLY,PANW,LSCC,IOT,CARG,DUOL,ACLS,LNTH,DHT,DKNG,INSW,PARR,BBIO,MELI,
Fundamental leaders (FA Score)
FRO,EURN,ALB,INSW,CALM,ASC,ELF,CPRX,DHT,MUR,H,PANW,ANET,HIMS,ALGM,AEHR,NE,BTU,NCLH,PR,
Technical leaders (TA Score)
ONON,FSLY,DUOL,BBIO,ALGM,ACLS,AEHR,ANET,LSCC,IOT,INDI,ELF,ASAN,HIMS,LNTH,CNK,SHOP,DKNG,FRO,DOCN,
Relative Strength 1 Month (1M-RS)
DUOL,MAXN,ONON,ASAN,FOUR,IOT,OKTA,DOCN,ANET,PGNY,FLYW,LSCC,CSIQ,SKIN,CRWD,ALGM,FSLY,HCC,ENPH,SHOP,
Relative Strength 3 Month (3M-RS)
FSLY,ONON,DUOL,BBIO,AEHR,LNTH,ACLS,INDI,CNK,ASAN,DKNG,ALGM,HIMS,IOT,ELF,DOCN,ANET,FRO,MPWR,CARG,
Relative Strength 6 Month (6M-RS)
AEHR,FSLY,ACLS,ONON,ALGM,ELF,DUOL,SMCI,BBIO,HIMS,LSCC,PARR,OII,RXDX,IOT,ANET,INDI,SHOP,AIMC,FRO,
REFERENCES
Articles on the system:
I really hope that you enjoyed it. If you did, please share it & hit the LIKE button so that more folks can be reached and this Newsletter can grow. :)
I think the new one works fine. You’re probably also going to have IPO setups at some point, and they could then also have a separate section.
Love the new FL setup!! 🔥