Alex's daily Market update & Focuslist report - 08/21
Market bounces, on weak breadth and led by mega-caps. Can we follow through, or we'll rollover...?
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GENERAL MARKET ANALYSIS
S&P500 (ES_F)
ES gapped up and could not hold it as we retested the overnight 4375$ low pivot before making a new high and pushing +0.68% higher.
Today, we followed through on Friday’s 4341/4369$ structure area bounce with a HL & HH.
Now that the easy part is done, we'll get into the crunchy tomorrow with overhead resistance within reach.
We have a lot of overhead resistance ahead:
4419$ level (rejected today)
10dma (0.65% above)
high_AVWAP
21 + 50dma
4493$ structure levels
Until we reclaim these levels, we’ll need to look for either consolidation in that range or a rejection that would resume that pullback to these potential targets below.
Levels I’m watching for potential support if we pullback further:
4341$ recent support structure
4312$ level
30wma/200dma
4221/4259$ 2022 important base structure area
NASDAQ (NQ_F)
RUSSELL 2K (RTY_F)
Upside continuation confirmed with a close above 1965$.
PT MARKET MODEL (PTMM) & INTERNALS
PTMM is still on a FULL RED (🟥) signal.
Price closed FLAT (+0.00%) and still below all down-trending kma's.
Breadth was FLAT (+12)
U/D volume at 4.46 (strong - skewed by NVDA)
MCSI DOWNTREND + BELOW 10dma (decelerating a bit)
Daily MOMENTUM was UP, but lower than yesterday (1.11)
LT_momentum was down today (3.27)
NNL is at -10 (1.5%) & PTHL tried to round with a nice jump NH today.
-2.86% < 50dma.
BOTTOMLINE: Despite seeing follow-through on the major indices, the mega-caps skewed the PA, as we didn’t see a strong breadth & participation today to confirm the follow-through.
We’ll see tomorrow, but if we continue to rally on poor breadth like that, chances of a rollover & bear flag increase.
We need to see broad strength!
Internals
MMTW (Stocks > 20dma - market extension)
MMTW now prints a reversal at the 20% level, paired with #ES_F, #RTY_F & #NQ_F being at significant potential support making a technical/oversold bounce possible to start the week. Where we go after that, only the price will know.
MMFI (Stocks > 50dma - market extension)
Below 40%, but still, room to go. New low today.
VIX NEARLY broke below 17$. That's the move I wanted to see today. Another step in the right direction, but we need to follow through below 17$ tomorrow to confirm it.
MOVE (Merrill Lynch Option Volatility Estimate - Bond market volatility)
Right at KEY DTL while building higher lows and above all kma's as the 10Y yield hangs near the highest level since 2007. Not implying anything, only noting pivotal areas at historical levels.
UPDATE: BREAKOUT confirmed
10Y Bond Yields (daily)
Historical 4.33% level breakout today. Highest level since 2007…
Good thing to see CS following through on the 50dma & structure rejection. If we don’t spike here, this is constructive.
BTC/USD (Bitcoin)
Big washout last week as we broke that recent daily structure and triggered a lot of forced selling as we retested that 25k area this week. If we can’t hold here, 24k is the next potential support.
In the following sections of tonight’s letter, I’ll cover essential parts of my daily routine & preparation for tomorrow’s trading session.
Make sure to subscribe and support my work if you’re interested!
✅ My overall current market Takeaways & GAMEPLAN for tomorrow
✅ My daily Focuslist, including setups, alert levels & explanation (LONG/SHORT)
✅ My Portfolio update
✅ Sectors Review
✅ Economic Calendar
✅ Prime Model spreadsheet (PT_database)
✅ Leaders list (technicals, fundamentals & potential TMLs)
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