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Alex ✌️
GENERAL MARKET ANALYSIS
S&P500 (ES_F) Daily
Friday, we experienced a very wild with a couple of 2-3% intraday swings. We sold off pre-market below the 3735$ pivot on NFP data and then really played ping-pong between this level and 3780$ all day. Overall it was a green day on volume at an important support area, so we have to respect that potential reversal.
We just opened on the Sunday night futures, and we just gapped down -0.80%, inside the support area. Let’s see if this weakness will spread into Tomorrow.
Tomorrow, I want to see the market hold this 3735$ level and reclaim that 3780$ if we want a chance to follow through on the upside. We are in a downtrend, and there are a lot of kma’s overhead, so even if we reclaim that 3780$ level tomorrow I would be VERY CAREFUL with long exposure as a rollover is very possible at the 21 or 50dma.
NASDAQ (NQ_F) Daily
RUSSEL 2K (RTY_F) Daily
Alex’s TAKEAWAYS
Overall I remain bearish until we have constructive action that we can build upon and cover our short position. Remember, we follow price action and now the trend is down and the PA is telling us the path of least resistance is down…until proven otherwise.
What I like:
The VIX is flat and not spiking today - interesting divergence
Breadth has bounced from last week's reversal - lower high or continuation?
A BIG selloff on DXY - This is normally good for equities
Getting some long setups tonight
ES_F bounce at an important support area - but one day is NOT a trend, needs confirmation, and a lot of overhead resistance.
What I don’t like:
10Y yields continue higher and build pressure right below DTL
Bounce & rejection & some follow-through in the sectors
ES_F is still in a downtrend and below all kma’s.
Gameplan:
Overall, we remain in a downtrend as pointed out…BUT this can change quickly. Tomorrow my focus will still be to manage my short NQ_F position (SQQQ). If we undercut the 10713$ level, I will add probably another 10% position. If we rally hard and reclaim the 50dma on ES_F, which is not even 1% above, this will really be a signal for me to cover my short position and put some pilot positions in 1-2 names.
This is CPI week on Thursday (8:30 EST), so note that we might get choppy action 1-2 days prior like we saw last week before FOMC. Not a time to be too aggressive on either side, especially at the close Wednesday.
PORTFOLIO UPDATE
INTRADAY/CLOSED TRADES:
LONG FOCUSLIST
Like I said in my takeaways, it’s not because I have a long FL that I will take them. But I am always prepared in case things turn around fast. Preparation!
LULU 335.71, PCG 15.61, SMPL 38.47, SLCA 14.72, STLD 97.02, CAR 238
LULU 0.00%↑
Still building nicely above the 50dma. I am looking at the same 335.71$ pivot as being the confirmation of the base area retest & continuation.
ALERT: 335.71$
SETUP: BORS
PCG 0.00%↑ 🎖️
Top focus name for me. After a multi-month breakout, we firmed a secondary base that we are just retesting along the 10dma. watching the 15.61$ recent swing high pivot for an entry.
ALERT: 15.61$
SETUP: BORS
SMPL 0.00%↑
Good recent ER that created that 20% 3 days thrust into the swing high pivot. We consolidated down to the 10dma since then and building that nice channel that we might breakout tomorrow and try a reclaim of that 38.47$ pivot.
ALERT: 38.47$
SETUP: BO10PB
SLCA 0.00%↑
SLCA, my best trade in March 2022 just had a big multi-month consolidation that we broke 2w ago just prior to earnings with that DTL breakout. We are building a nice tight area in the last few days that might offer a solid entry off the 10dma retest.
ALERT: 14.72$
SETUP: WBPB
STLD 0.00%↑
Very strong steel name with a recent run post-ER right into almost new highs, retesting the 100$ level. I am now seeing a very narrow and tight consolidation back to the 10dma which could offer a great R/R entry. We just broke the mini-channel DTL and we could retake the most recent swing high to trigger the entry.
ALERT: 97.02$
SETUP: WBPB
CAR 0.00%↑
Stage 1 base breakout on a 40% thrust and now consolidating at the 10dma and well contained below the DTL. If we can reclaim the most recent swing high and breakout of that DTL, that would offer a great low risk entry following the initial base breakout.
ALERT: 238.00$
SETUP: BO10PB
🎖️ = Alex’s highest conviction setups
SHORT FOCUSLIST
MARKET BREADTH & INTERNALS (RISK MODEL)
NYHL (New 52W Highs - Lows) - Seems to stabilize and not pick up to fast.
Trend @ -232 (⬆️)
NYAD (Net Adv/Decl) - Back in the positive, but still a modest participation
20dma @ +183 (⬆️)
MCOSINYA (McClellan Oscillator) - Turned back up along the 20dma.
20dma @ +85 (⬆️)
MMTH (Stocks > 200dma - LT breadth) - 10dma bounce follow-through. We’ll make a lower high or we breakout and continue higher?
MMFI (Stocks > 50dma - MT breadth) - 10dma bounce follow-through. We’ll make a lower high or we breakout and continue higher?
MMTW (Stocks > 20dma - ST breadth) - 21dma bounce follow-through. We’ll make a lower high or we breakout and continue higher?
VIX (Volatility S&P 500) - We continue down pretty aggressively here and are still below all kma’s. We are right into potential support, so we have to be careful with the long positions IMO as we might get a reversal pretty soon on here.
DXY (US $) - Now that’s a move…2% down for the US$. This is the kind of move that if we follow-through could really give some air to the equity market. I see this as a big positive.
US10Y/TNX (US 10Y bond yield) - 10Y yields are still building that flag above all kma’s. This is a big red flag.
IEI/HYG (Credit Spread) - Was not able to follow-through and for rejected at the 21dma and close below the recent swing low.
BTC/USD (Bitcoin) - BTC with a big push Friday and this week that we were not able to hold Sunday. I don’t really like that we came back in below the 21012$ level. Let’s see how we handle that and if we find support at the 10dma. We are still above all kma’s.
ECONOMIC & EARNINGS CALENDAR
SECTORS PERFORMANCE
(XLE) Energy - Gap up to retest the highs, but was not able to hold it. I just feel we need more time to consolidate and let the kma’s catch up before we make the base breakout. We are quite extended.
(XBI) Biotech - XBI almost lost that UTL Friday, but rallied pretty hard by EOD. I still see this as a 50dma rejection and potential short setup, but have to respect that strong close Friday.
(SMH) Semiconductors - Thursday was finally a shakeout below 184$ and we gapped up above the 10/21dma and closed above the base area. Expectation breaker here. Wil it follow-through?
(IGV) Software - Weakness continues, but we are now approaching Oct. lows and might offer some support.
(PBW) Clean Energy - Gapped up at the 21dma and rejected it, but closed in the upper half of the candle still. Looking like a healthy consolidation to me. Might just need more time.
(TAN) Solar - Big gap up right around the 50dma and in that base are that got rejected pretty hard Friday. We found some support at the 10/21dma…but honestly don’t look too healthy to me.
PRIME MODEL SPREADSHEET (PT_database)
Access to the PT_database 👇
LEADERS LIST
Overall leaders (PRIME Score)
ASC,TNK,INSW,YPF,PBF,AEHR,RES,DO,APA,DINO,XPRO,WFRD,PR,WTI,MRO,ERF,PARR,CHX,SMCI,ENLC,
Fundamental leaders (FA Score)
ERF,BHF,RES,SWAV,DRH,SIGA,WTI,ASC,DK,LBRD.K,TNK,ESTE,FANG,KOS,PR,JXN,LTHM,CPE,CALM,PDCE,
Technical leaders (TA Score)
ASC,WFRD,YPF,INSW,XPRO,CHX,DO,PBF,APA,TNK,AEHR,LPG,RES,ELF,MRO,DINO,HAL,NAT,SMCI,PR,
Relative Strength 1 Month (1M-RS)
CHX,ASC,MAC,CAR,AEHR,ULCC,LPG,VCYT,NCLH,RES,PTEN,HAL,CCL,DO,LEGN,WFRD,SMCI,RKLB,RCL,SEAS,
Relative Strength 3 Month (3M-RS)
YPF,WFRD,WTI,INSW,ASC,PR,XPRO,APA,SLB,PBF,TNK,MRSN,DO,MRO,AMRS,CHX,MUR,RES,PARR,PDCE,
Relative Strength 6 Month (6M-RS)
YPF,INSW,AEHR,ASC,TNK,WTI,MRSN,WFRD,ELF,STNG,CCRN,SWAV,CPRX,STKL,PBF,PR,PARR,DHT,EURN,XPRO,
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