Alex's daily Market Update & Focuslist - 05/25 🖊️
Disclaimer: This newsletter is not financial or investing advice. The information is for education purposes only and reflects only my own operation.
After a very good close yesterday, market was not able to hold his gains and retraced back in the 3858/3902$ support area. Today was very positive imo as we could have flushed from here, but we found very good bid that supported the market and created a higher low. It’s now been 4 times we defend this area.
Upside:
We’ll first want to see the market regain his 5dma, then I’d like to see a breakout of the 3981$ pivot & 10dma to confirm the potential rally. Channel DTL is 1.5% above, so if we have a very strong day, it’s possible that we attempt to breakout for our channel. That would be a perfect bullish scenario.
Tomorrow will be day 4 of attempted rally...again. We'll be on the lookout for a FTD. What Is A Follow-Through Day? | Investor's Business Daily (investors.com)
Downside:
It’s possible that 3981$ pivot & 10dma act as overhead resistance and we rollover. If that’s the case, we want to see 3902$ pivot hold to keep the rally healthy.
We still are below ALL KMA’S, so despite very positive action in the last few days, we want to stay very careful. I want to build my exposure very progressively on current profits. I don’t want to risk any capital. We have still A LOT OF POTENTIAL RESISTANCE ABOVE.
SNET new 52w lows on both NYSE & NASDAQ.
Stocks > 50dma still in that bear flag in the resistance area. We are able to hold it and closed pretty flat. If we breakout of that channel DTL tomorrow, that will be A BIG change in character and could mean a market reversal and potential rally imo.
VIX rejected yet again 30$… WHICH IS SUPER POSITIVE. Now 4 consecutive days with attempt higher and rejection which formed big wicks. Simply unable to rally and being smashed each day. That’s what you want to see on a market reversal. Clues begin to stack up…tomorrow will be pivotal.
P/C ratio still not spiking, so no real fear in this market yet.
McClellan ratio still in positive @ 60.
Tomorrow we have FOMC minutes of last meeting. Should not be anything new, but we never know, we have to be alert still.
Pretty defensive sectors led the day. Nothing important catching my eyes today.
Solar & C Energy pulling back today, we’ll have to see if this will be supported quickly.
Also still looking at Crude Oil (CL_F) for a potential breakout. Price action is super constructive which yet another very tight day and pushing again against 111.37$ pivot. Volume is getting really low in the congestion area, we’ll make or break pretty soon.
I’ll also be looking at NG_F (Natural Gas) as my current positions are in this sectors and the commodity strength is driving individual stocks. We tested base top today at 8.91$ pivot. Tomorrow will be important to see if we can breakout from here, or reject it and retest maybe the 5 or 10dma in the next few days.
Today was really a test and 2 of my 3 positions held very well and gave me no reason to sell despite the market was below the 5dma. SL are in place, so letting the trades work from here.
CELH SL was hit this morning not late after market open. Took a minimal loss on the position.
New positions:
EQT (This position was so strong all day long and simply refuses to follow the general market. I want to focus on the few names that are working as we’re early in a potential rally, and if it materializes it’s the nae that show RS and breakout now that will lead. I added on the intraday wedge break, see below)
Trimmed positions:
Closed positions:
CELH (SL was hit this morning not late after market open. Took a minimal loss on the position.)
9 names in the Focuslist tonight.
I see some very good setups that are building around KEY LEVELS or KMA’S. Despite today’s action, many names of yesterday’s FL are here again tonight after having made an inside day or strong action today.
We are still pretty much in the same sectors: Nat Gas, Oil, Chemicals, Coal, Steel…and Energy drink lolll :)
Even if we get an amazing day tomorrow, remember to use progressive exposure during the day to finance the risk of your next position. One step at a time, don’t load the boat, there will be PLENTY of occasion to jump in stocks if this rally materializes. Remember how the last 2-3 times we rallied, market punished hard right on the next day.
TELL - Still top of my FL for tomorrow. Today was not quite an inside day, but we close within yesterday’s price range and we are still above our support area. Still looking at the same levels, 4.74 & 4.97$ for a potential entry.
NTR - Also a very nice BORL setup right at the 50dma and prior support area. We made a higher low in the last 2 days, and an inside day today. I’m looking at the DTL & 102.87$ pivot for the setup confirmation.
KOS - Same setup here as well, BORL. Looking for the setup confirmation on the 7.25$ pivot breakout. Inside day today on very low volume, looking good for a breakout very soon
HES - Another Oil name setting up really good in a ascending wedge formation. I see a series of higher lows forming and squeezing it against his 118.86$ pivot which would confirm the breakout.
VLO - One of Oil sector leader. We might see another couple days of tight action before seeing a DTL forming on the right side, but I still have my alert set at 127.64$ that would confirm the base breakout and continuation.
CELH - Been shakeout of this name today on market weakness, but setup is still intact & in play. Never remove a name of your FL even if your SL get hit, it took me 2-3 entries to catch my own best trades. I’ll want to use 61.37$ pivot breakout for an entry though.
CVI - Another Oil name with a very nice HTF base. We got supported again at the 10dma & 31.45$ pivot. I’ll be looking at 32.52 pivot for a potential entry.
AMR - I see a base on base breakout yesterday on this Coal name. Today, we retested the area on low volume, creating a nice BORS setup. Breakout candle high at 170.91$ is the pivot I’ll use to confirm the setup entry.
TMST - Steel stock showing a lot of strength recently. Still within the base, but this name as the habit to run without giving much entry. The 22.79$ pivot could be used for continuation confirmation here after a very powerful retest of long term consolidation.
I’ll start tracking top fundamental stocks with highest 6 months Relative Strength, holding up the best short term. (40% 1M-RS + 60% 6M-RS ratio).
During market correction, you want to keep track of these names as they will be the one to watch when conditions improves.
Relative Strength 40/60 - TOP 20:
HDSN,VTNR,SIGA,AMR,AR,EQT,DK,SD,VAL,CVE,LNTH,GOGL,TMST,ESTE,ARLP,BTU,HRB,CVI,CHK,CC
Relative Strength 1 Month - TOP 20:
VTNR,PRPL,CELH,SIGA,CVET,SQM,RELY,HDSN,HRB,DVAX,PAYO,SLDP,PRCH,COMP,SOFI,LTHM,ESTE,BTTR,AHCO,AMRS
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