Alex's daily Market update & Focuslist - 01/10
Expectation breaker!
GENERAL MARKET ANALYSIS
S&P500 (ES_F) Daily
Price Action Analysis:
ES_F held the 21dma & 3898$ level today!
After yesterday’s reversal, this was the logical place for the market to retest key levels and bounce from them. For me, today’s action adds a lot of confirmation & confidence in the rally we might have. Seeing a long consolidation, breakout, and then retest & bounce from the top level like that validates & confirms the breakout.
I don’t know where & when we’ll find resistance, and this ST rally will stop, but right now, I have the clues & market participation (breadth) that tell me we might see more of this action. Note that we could always have a surprise economic news to make it stop right away. (Like CPI on Tuesday…)
ES_F also closed above the 50dma, which is very good.
On the upside,
I will be looking closely at the 3964$ level and also Friday’s high pivot for potential resistance. This is where we reversed Friday, so breaking out from there would be a big deal.
On the downside,
3918$ have to hold on a retest.
NASDAQ (NQ_F) Daily
RUSSELL 2K (RTY_F) Daily
In the following sections of tonight’s letter, I’ll cover essential parts of my daily routine & preparation for tomorrow’s trading session.
✅ My overall current market Takeaways & GAMEPLAN for tomorrow
✅ My daily Focuslist, including setups, alert levels & explanation (LONG/SHORT)
✅ My Portfolio update
✅ Sectors Review
✅ Market Breadth & Internals
✅ Economic Calendar
✅ Prime Model spreadsheet (PT_database)
✅ Leaders list (technicals, fundamentals & potential TMLs)
Alex’s TAKEAWAYS
Today we confirm the uptrend & potential rally IMO by retesting the consolidation area and rejecting it.
We are seeing the indices showing good action, breadth improving for the last week, and we are now seeing breakout holding in some specific sectors.
We are not seeing an overwhelming quantity of setups yet (in the type of stocks I’m watching. Many powerful moves happen in beaten down & stage 4 stocks right now), but this might come in the next few days if this rally picks up strength.
Will this be a multi-day/week/month rally? I don’t know. I know the probabilities are shifting on the long side, and we’ll play these odds as long as they are there. We will have our signal when things turn. So day by day, we’ll follow price action & the trend.
Some observations:
ES_F expectation breaker on the upside today, confirming the ST rally IMO.
VIX follows through on the downside.
Overall the breadth continues to improve.
Important CPI news Thursday 8:30 - adjust exposure accordingly.
Market health & Trend indicators:
LT_SIGNAL: uptrend (black) + BELOW 50dma = BEAR market under pressure (🟨)
MT_SIGNAL: uptrend (black) + ABOVE 10dma = UPTREND (🟩)
Tomorrow's economic news:
GAME PLAN:
We are back above the 50dma, and my Exposure Model allows me to crank exposure up to 50%, but I still don’t have the profits cushion to justify increasing it so far yet. I have to gain traction on my open positions before risking more. (progressive exposure)
As noted above, CPI is Thursday, so I will take some profit into strength tomorrow's EOD as this event can have a significant impact. If things go very well tomorrow, I don’t want to go into it with more than 30-40% exposure and a good cushion on all my positions.
If we get traction, the focus remains on the LONG side and building exposure incrementally.
EXPOSURE MODEL:
FOCUSLIST (LONG)
FLYW 25, BAND 23.18, AG 9.05, CELH 103.1, LABU 7.33,
FLYW - Alert: 25, SL: 24.23
We tried to breakout out the 25$ pivot today, but we got dragged down with the market reversal this afternoon.
UPDATE: big fakeout today. it needs more time to breakout. Setup & alert still valid.
BAND - Alert: 23.18, SL: 20.69
One of the best performers of the last six months is still in a clear channel on low volume for the past couple of weeks. We got rejected at the 10/21dma today, but I want to keep an eye on this one if the market was to rally higher. Reclaiming that swing high would also coincide with a channel DTL breakout. Not a high conviction setup for tomorrow, but if it works, it could be a great entry off a potential lower high at the 50d.
UPDATE: Still building nicely below the DTL.
AG - Alert: 9.05, SL: 8.57
The Metals & Mining (XME) sector is acting very constructively, and within that group, silver stocks seem to be ripe for a move. We saw PAAS today retesting the stage 1 base pivot, and now AG, which I have followed for a while, is getting squeezed on the right side just below the DTL and 9.05$ pivot. Kma’s are also very tight and coiled.
CELH - Alert: 103.1, SL: 96
A name that I love the fundamentals & story is building a very tight wedge for a few weeks and can’t break down from the 50dma rejections. I will try an anticipation entry off the 103.10$ pivot reclaim but keep in mind that we have some important resistance between 105$/110$ area. That’s the type of trade I will start with a smaller position and increase as we confirm the strength into resistance.
LABU - Alert: 7.33, SL: 6.59
Once again, we get a reversal in the consolidation area. I am still watching the 7.33$ level for an entry into the Biotech sector.
PORTFOLIO UPDATE
INTRADAY/CLOSED TRADES:
SECTORS PERFORMANCE
Leading sectors:
(XBI) Biotech - The chop fest continues… but we bounced once again from the kma’s and 81$ level.
(GDX) Gold miners - The trend continues
(XLE) Energy - We were supported at the 10/21dma and reclaimed the top level range. Interesting action, along with many names in the sectors being strong.
(XME) Metals & Mining - Powerful action with a bounce off the 52.70$ pivot and closing above yesterday’s high.
(XLV) Healthcare - Healthcare is hanging with a reversal attempt but closed below the 50dma & inside yesterday’s range.
Sectors on watch:
(SMH) Semiconductors - Good action today, but still inside day.
(TAN) Solar - Very powerful move above yesterday’s high and sitting right at the 50dma and 77.7$ resistance level. Tomorrow will be critical.
MARKET BREADTH & INTERNALS
$USHL (Cumulative new 52W Highs/Lows & 50dma)
Still on bear market signal…BUT still UP. We are in a BEAR market under pressure signal.
LT_SIGNAL: uptrend (black) + BELOW 50dma = BEAR market under pressure (🟨)
!MCSUMNYA (McClellan summation index & 10dma)
MT_SIGNAL: uptrend (black) + ABOVE 10dma = UPTREND (🟩)
NYHL (New 52W Highs/Lows) - Small retracement today with 55 NNH. Still trending up, so let’s see if we can make a new high in the next few days.
NYAD (Net Adv/Decl) - back above +1000.
MMFI (Stocks > 50dma - MT breadth) - new high
MMTW (Stocks > 20dma - ST breadth) - Inside day, hanging in the overbought area. We can stay in that area for quite some time, so not a sell signal by itself.
VIX (Volatility S&P 500) - bearish outside reversal with a new low. This will be interesting to see if we can retest the 19/20$ support area. IF we breakdown from that area, this would be a MAJOR bullish signal for the market IMO. My guess is we might see it on CPI if the market gets what it wants on this report.
DXY/TNX (US$) - Inside day and building an intraday bear flag.
US10Y/TNX (US 10Y bond yield) - Reversal today, but still below all kma’s.
ECONOMIC & EARNINGS CALENDAR
PRIME MODEL SPREADSHEET (PT_database)
Access to the PT_database 👇
LEADERS LIST
Overall leaders (PRIME Score)
ARDX,AEHR,RIG,OII,WMG,TGTX,RCL,CPRX,FOUR,YY,IGT,FRO,CPRI,COTY,FTAI,ALGM,CCL,CSIQ,VAL,CAKE,
Fundamental leaders (FA Score)
NOG,FRO,CALM,PR,RUN,AEHR,HGV,TRIP,GFS,JXN,LBRT,DVAX,CEIX,DK,PBF,ALB,LYV,EURN,NEX,ARDX,
Technical leaders (TA Score)
TGTX,ARDX,RIG,OII,AEHR,WMG,RCL,CPRX,CPRI,COTY,FTAI,YY,ALGM,FOUR,IGT,KLAC,CSIQ,FRO,HAL,CAKE,
Relative Strength 1 Month (1M-RS)
AUPH,ARDX,TGTX,CLF,NVAX,CAKE,BTTR,RIG,MLKN,TRIP,COTY,ONON,CSIQ,FTAI,SPR,WMG,JBLU,CARG,BLMN,AAL,
Relative Strength 3 Month (3M-RS)
TGTX,BAND,ARDX,OII,AEHR,RIG,WMG,CPRX,YY,ALGM,KLAC,COTY,CPRI,CCL,RCL,IGT,FTAI,SMCI,HAL,NLY,
Relative Strength 6 Month (6M-RS)
ARDX,AEHR,TGTX,CPRX,OII,RIG,SMCI,RCL,BAND,FOUR,WMG,FRO,ALGM,INSW,YY,ARRY,CPRI,VAL,ELF,IGT,
REFERENCES
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