Alex's daily Market update & Focuslist - 12/14
We survived FOMC day...but?
Good evening folks!
Another big day with the Interest Rate decision and FOMC. Wild & big moves, but the market was able to hold…!
Let’s see where we might be heading.
Alex ✌️
GENERAL MARKET ANALYSIS
S&P500 (SPY) Daily
Price Action Analysis:
What a day, again!
The market reclaimed the 402/404$ area this morning as things were looking good until the interest rate news dropped at 14:00 and tanked the market -2%. We were able to bounce pretty nicely at the 21dma and 397$ level.
We managed to close above all kma’s and in today’s mid-range. Not bad.
On the upside,
The 402/404$ area will act as a first resistance and potentially the bear market DTL. Then a couple of levels to watch if we follow through on the bounce of EOD:
410$ previous swing high
412/415$ resistance area
On the downside,
10+21dma and the 397$ level become potential support. now confirmed as VERY IMPORTANT.
I’m also watching the last few days’ UTL. If we were to break that as well, things could really cascade down.
Next, the 390$ level is the next very close potential support
Next, the 387$ level & area is my next target on the downside.
If we can’t hold these levels, the 50dma is the next logical support within reach.
NASDAQ (QQQ) Daily
RUSSELL 2K (IWM) Daily
Alex’s TAKEAWAYS
Now that CPI & FOMC is behind us, we might be able to get a better idea of the market action and see more clearly with volatility coming off a bit.
I am still very cautious with this market, and I do have a lot of mixed signals right now.
The indices held well on the FED reaction and bounce from key levels (21dma & 397$)
It could be a normal reaction to the bear market DTL & 200dma initial attempt, and we’ll get our 2nd attempt.
The breadth deteriorates (NNH/L, A/D, S>50, etc.)
LT & MT signal is aiming back down after a quick thrust yesterday.
Solar, Health Care, and Biotech were strong today, but overall the sector’s participation is narrowing
Some recent leading stocks begin to break and lose momentum, but overall the leadership is narrowing too.
I also have no traction on the 4 positions I opened 2d ago. It’s a red flag if we don’t again tomorrow.
Overall, I remain very cautious and don’t discard the rollover scenario with the current deterioration we see right now. If we can push from these levels in the next 1-2 days, and I see traction in my positions, in leading names, and overall in the market breadth, then I would change my idea…but right now, I just don’t see the power to get aggressive. That market is still not healthy, risk first.
Market health & Trend indicators:
LT SIGNAL: downtrend (red) + BELOW 50dma = BEAR market (🟥)
MT SIGNAL: downtrend (red) + BELOW 10dma = Downtrend (🟥)
Tomorrow's economic news:
Gameplan:
Tomorrow, I want to see the reaction at the 397$, UTL & 21dma on $SPY. Also, my positions have to start getting traction, and I will start reducing exposure.
If we bounce with good power and my positions are working, I will add more exposure.
If we break the 397$ level, the UTL, or the 21dma, I will close all long exposure and look to initiate a short position.
In the following sections of tonight’s letter, I’ll cover essential parts of my daily routine & preparation for tomorrow’s trading session.
✅ 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)
Make sure to subscribe!
Keep reading with a 7-day free trial
Subscribe to PrimeTrading to keep reading this post and get 7 days of free access to the full post archives.