Alex's daily Market update & Focuslist report - 08/27
The market refused to break & follow through down despite the initial selloff during Jackson Hole JP's speech - Where are we going next?
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GENERAL MARKET ANALYSIS
S&P500 (ES_F)
The market refused to break & follow through on last Thursday's reversal despite the initial selloff during Jackson Hole JP's speech.
We found support exactly at the 4369$ base level and rallied hard all afternoon to retest the 10dma.
We could not close above the 4419$ structure level & 10dma, which I would have liked to confirm the bounce and HIGHER LOW we just made Friday.
The ST trend remains DOWN, but if we can follow through on Friday's HL, we might have the ideal pullback scenario we were looking at last week.
We have important overhead resistance ahead:
high_AVWAP
21 + 50dma
4493$ structure levels
Until we reclaim these levels, we’ll need to look for either consolidation in that range or a rejection that would resume that pullback to these potential targets below.
Levels I’m watching for potential support if we pullback further:
4341$ recent support structure
4312$ level
30wma/200dma
4221/4259$ 2022 important base structure area
NASDAQ (NQ_F)
RUSSELL 2K (RTY_F)
PT MARKET MODEL (PTMM)
PTMM is on an LT GREEN market signal (🟩), on PULLBACK (🟥).
Price closed UP (+0.45%) and below all kma’s.
Breadth was UP and weak (+140) - Not impressive for a potential higher low
U/D volume at 1.12 - just OK
MCSI DOWNTREND + BELOW 10dma - trying to decelerate
Daily MOMENTUM was UP (1.60) - just OK
5 & 10-day ratios both flat
NNL is at -12.
-3.02% < 50dma.
BOTTOMLINE:
The market refused to break & follow through on yesterday's reversal despite the initial selloff during Jackson Hole JP's speech.
The ST trend remains DOWN, but we see Breadth and Momentum now flat and trying to curve back up. If we can push and see a breadth thrust as we turn up, we’ll have something constructive for a potential tradable rally.
We are still in no man’s land as we try to carve a bottom after that four-week pullback.
Internals
MMTW (Stocks > 20dma - market extension)
Still trying to work a bottom in the oversold area.
MMFI (Stocks > 50dma - market extension)
Intraday undercut of recent lows & rally (U&R). Could act as a shakeout.
VIX with a big 17$ level rejection today as we even made a lower low and closed below the 21dma and structure area. That's a big and constructive move imo
MOVE (Merrill Lynch Option Volatility Estimate - Bond market volatility)
Back below all kma’s. If we break that UTL, we have good chance to see Yields trending down.
10Y Bond Yields (daily)
10Y could not follow through on the bounce attempt and we MIGHT have made a LH. We remain above all, so we still work to do
Credit Spreads right in that structure support area after being rejected at 10/21dma today. This is constructive action, but if we can break that support area it would be even better
BTC/USD (Bitcoin)
Still building that tight bear flag-ish structure 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.
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✅ My overall current market Takeaways & GAMEPLAN for tomorrow
✅ My daily Focuslist, including setups, alert levels & explanation (LONG/SHORT)
✅ My Portfolio update
✅ Sectors Review
✅ Economic Calendar
✅ Prime Model spreadsheet (PT_database)
✅ Leaders list (technicals, fundamentals & potential TMLs)
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