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Alex ✌️
GENERAL MARKET ANALYSIS
S&P500 (ES_F) Daily
Today was one hell of a day again. This morning was pretty easy and we did run right into 3855$ as pointed out last night, we were never able to really push into that resistance area and got rejected very hard early in the afternoon. We did find support at the 21dma and bounce right back up to close the day almost at 3855$ again. These wild intraday swings lately are quite something… There might have been some of the FTX story & Crypto selloffs that spilled into the equity market, but still.
Tomorrow, we’ll need to see first where we open due to the midterm results. On the upside, I’m still looking at the 3855$ level and potentially 3903$ which was the recent rally high pivot that we would need to take out to confirm continuation higher. On the downside, if we close below the kma’s and also the 3780$ level we would not be in a very good posture before CPI data on Thursday morning.
Keep in mind that we have quite a packed week with the mid-term elections on tonight that could affect the market tomorrow, and also CPI data release Thursday morning that will be very important and potentially very volatile news.
Normally, the day before CPI it can be quite choppy and directionless…so be careful not to get caught in this action.
NASDAQ (NQ_F) Daily
RUSSELL 2K (RTY_F) Daily
In the following sections of tonight’s letter, I’ll cover very important parts of my daily routine & preparation for tomorrow’s trading session.
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Alex’s TAKEAWAYS
Overall I remain VERY cautious due to the mid-term election and the CPI release later this week. I don’t want to get caught in a surprise outcome or a hot CPI # that would roll over that market.
Mixed signals again tonight…
What I like:
Breadth followed through on Friday’s reversal - BUT, weak again…
Follow-through on DXY selloff and now below 110$ important level.
The 10Y yields had a red day and relieve some pressure.
ES_F continued higher after reclaiming the 50dma
What I don’t like:
The VIX spiked today from the 25$ level and recent support area. It also closed really strong right before the midterm…
Outside of Energy, there are not a lot of interesting long setups.
Crypto puked on the FTX news - could this spill into the equity market?
ES_F was rejected very hard today at the 3855$ resistance level.
Gameplan:
Again tomorrow, I will not trade much and wait to see the CPI reaction before putting back any long exposure. Should be a very quiet day for me tomorrow.
I will try to manage my UVXY trade if the market were to open higher tomorrow and the VIX comes down, but otherwise, I will swing this new position with a very tight SL and risk.
PORTFOLIO UPDATE
INTRADAY/CLOSED TRADES:
LONG FOCUSLIST
LULU 335.71, DEN 97.21, PBF DTL+48.37, HRMY 59.27, ZETA DTL+8.45
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.
UPDATE: LULU had a good day today, but came down with the market. Still above all kma’s and building nicely right below the entry pivot.
ALERT: 335.71$
SETUP: BORS
DEN 0.00%↑
Energy name with a long retest of the base area and the 50dma in the past few weeks. We just had ER and we broke the wedge DTL last Friday and retested it today. I would look at the recent swing high pivot for an entry.
UPDATE: Inside day right below the entry pivot, still in play.
ALERT: 97.21$
SETUP: BORL
PBF 0.00%↑
Another energy name that is always leading the sector, even in the March energy run. We are now building a nice consolidation at the base area. I will be looking at the DTL for a potential quick move. Notice the higher lows and how we respected the 10dma perfectly in the last few days.
UPDATE: Inside day as well, keep in play.
ALERT: DTL + 48.37$
SETUP: BORS
HRMY 0.00%↑
Recent IPO that just made a new high on the last ER. We are in the process to retest the base area, and a bounce here could be pretty powerful as this name has a tendency to make. I will be looking at PEG high pivot for an entry.
UPDATE: I tried this trade-off with the entry pivot today, but was not able to hold his gains and closed below it. I never remove a stock that squats lightly like that, the entry pivot is still valid for a re-attempt.
ALERT: 59.27$
SETUP: BORS
ZETA 0.00%↑
One of the strongest software names, yet not very known. I like that base breakout last week, that we came to retest in the last few days on declining volume. I will be looking at a DTL breakout or retake of today’s high for an entry.
ALERT: 8.45$ + DTL
SETUP: BORS
🎖️ = Alex’s highest conviction setups
SHORT FOCUSLIST
MARKET BREADTH & INTERNALS (RISK MODEL)
NYHL (New 52W Highs - Lows) - Improving again today
Trend @ -216 (⬆️)
NYAD (Net Adv/Decl) - Trend up and still in the positive.
20dma @ +281 (⬆️)
MCOSINYA (McClellan Oscillator) - Improving and trending higher.
20dma @ +101 (⬆️)
MMTH (Stocks > 200dma - LT breadth) - follow-through…but weak again…?
MMFI (Stocks > 50dma - MT breadth) - follow-through…but weak again…?
MMTW (Stocks > 20dma - ST breadth) - Unchanged and seems to really struggle up here.
VIX (Volatility S&P 500) - Bounce at the 25$ and recent support area.
DXY (US $) - Trend low continues and we have now closed below 110$ important structure level.
US10Y/TNX (US 10Y bond yield) - 10Y yields came back in the wedge and now sitting at the 10dma. We need to see if we follow through down from here.
IEI/HYG (Credit Spread) - REfuses to go down and now bounces again making the THIRD higher low in that consolidation. If this spikes, this is really not good for the equity market.
BTC/USD (Bitcoin) - BTC selling off with the entire Crypto market on this FTX news. We closed below 18669$ very important base level, now will we continue into stage 4 decline, or can digest that selloff and find buyers?
Look below for the story 👇
ECONOMIC & EARNINGS CALENDAR
SECTORS PERFORMANCE
(XLE) Energy - The strength here is quite impressive…it simply refuses to pull back and we are now retesting the base high. A breakout here could be pretty powerful… just be careful to not play it too aggressively because we are still pretty extended IMO.
(XBI) Biotech - XBI STILL looks like a solid WB short setup to me.. with yet another 50dma rejection…
(SMH) Semiconductors - Another gap up and strong day on volume, but found some resistance into the recent base area. The next few days will be important to see if we reject that area.
(IGV) Software - We had a nice follow-through on volume today, but got rejected at the 10dma. This is a good first step…let’s see if we can consolidate here.
(PBW) Clean Energy - Still consolidating at the 21dma… if we breakout above the 21dma, this could be a bullish signal IMO here.
(TAN) Solar - TAN was super strong today and close above 73.96$ level and right in that resistance area. This is the higher close of all the recent consolidation…breakout?
PRIME MODEL SPREADSHEET (PT_database)
Access to the PT_database 👇
LEADERS LIST
Overall leaders (PRIME Score)
ASC,INSW,PR,WTI,AEHR,YPF,RES,DO,PBF,ERF,WFRD,XPRO,PDCE,APA,MUR,PARR,TNK,CVI,DINO,MRO,
Fundamental leaders (FA Score)
BHF,RES,SWAV,SIGA,WTI,ASC,DRH,TNK,ESTE,FANG,PR,JXN,LTHM,CPE,CALM,PDCE,RUN,MUR,TALO,OVV,
Technical leaders (TA Score)
WFRD,ASC,INSW,PR,AEHR,CHX,XPRO,WTI,SLB,DO,YPF,APA,CPRX,PARR,ELF,MRO,PBF,LPG,ERF,RES,
Relative Strength 1 Month (1M-RS)
BAND,CHX,VCYT,ULCC,MAC,PTEN,SMCI,ASC,LPG,WFRD,CAR,MRNA,RES,XPO,AEHR,CNK,HAL,VIR,NCLH,EGHT,
Relative Strength 3 Month (3M-RS)
WFRD,YPF,INSW,PR,WTI,XPRO,SLB,PBF,ASC,BTU,APA,DO,MRO,CHX,MUR,PUMP,PDCE,RES,CCRN,HES,
Relative Strength 6 Month (6M-RS)
AEHR,YPF,INSW,ASC,ELF,WFRD,CPRX,CCRN,TNK,WTI,SWAV,STNG,STKL,PR,PBF,MRSN,PARR,XPRO,CHX,BTU,
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REFERENCES
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