Alex's daily Market update & Focuslist report - 08/02
Distribution day
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From August 13 to 18, there will be no daily reports as I will be on vacation without internet access.
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GENERAL MARKET ANALYSIS
NASDAQ (NQ_F) Daily
We went from tight & healthy digestion to a high volume breakdown through the 10/21dma. The 15475$ base area was also unable to hold as we closed right below.
This market was extended & overbought so we might be looking at an extended pullback/consolidation. We’ll have to see how we act at key levels in the next few days.
The 50dma is around 2% below and could be a logical demand area. If that pullback is shallow, we could also see a bounce from that 15475$ base area tomorrow, which would need to be confirmed by a good breadth thrust.
We know that today was a red flag, so we must remain on our guard if the market is not bought, but at the same time, be open-minded if the market quickly finds support and bounce.
One day at a time.
RUSSELL 2K (RTY_F) Daily
RTY acted better, as we held the 1965$ base level and were still above the 21dma. Leading indices right now.
S&P500 (ES_F) Daily
10/21dma break on above-average volume.
I’m watching the 4493$ base area for potential support in the next few days.
PT MARKET MODEL (PTMM) & INTERNALS
PTMM on a GREEN market signal (🟩), on PULLBACK (🟥).
We followed through on the failed breakout with a solid distribution day today. Price is right on the 21dma, and daily momentum was at an extreme 0.09 reading today.
We are within 3% of the 50dma. We are getting less & less extended as we digest the recent uptrend.
If this is a shallow pullback, I would look for a potential bounce at these levels. But if this is the more significant pullback we’ve all been waiting for, today is the first day of that potential pullback.
One day at a time, but today was certainly a red flag. I will be on the defensive unless we confirm a strong breadth thrust in the following days that would confirm the shallow pullback scenario.
Internals
MMTW (Stocks > 20dma - ST market extension)
Good to see MMTW dropping hard today. We need to remove the excess and be in the 10/20% area for a great buying opportunity.
MMFI (Stocks > 50dma - MT market extension)
MMFI began to break today, too as we undercut the 10/21dma and got off the overbought area. Still a lot of room down if the market decide to pullback.
Big VIX spike today as we are RIGHT INTO the recent 16/17$ ish structure area. If we break higher here, I think we might be looking at a larger pullback.
MOVE (Merrill Lynch Option Volatility Estimate - Bond market volatility)
Flat.
10Y Bond Yields (daily)
4.09% breakout. This is not good and certainly putting pressure.
Spiked as we reclaimed the 10 and now sitting at the 21dma.
BTC/USD (Bitcoin)
After showing good support at 28478$ level, we could not follow through today as we rejected the 21dma and closed back below all kma’s.
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 & weekly Focuslist (POSITION+SWING), including setups, alert levels & explanation
✅ My Portfolio update
✅ Sectors Review
✅ Economic Calendar
✅ Prime Model spreadsheet (PT_database)
✅ Leaders list (technicals, fundamentals & potential TMLs)
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