Alex's daily Market update & Focuslist - 11/22
ES_F channel breakout! - upside continuation?
Good evening folks!
Solid power trend all day with some leaders showing their hands, I hope you were able to do well today!
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GENERAL MARKET ANALYSIS
S&P500 (ES_F) Daily
Today, we got the channel DTL breakout that I was looking at, and confirms my bullish scenario. We also reclaimed the 3964$ level but were not quite able to reclaim 4016$.
Note that we have Jobless Claims data release tomorrow morning at 8:30 and also the last FOMC minutes being released at 14:00 that can really move the market, so no matter how bullish the market look right now, this can really change quickly tomorrow.
On the upside, tomorrow we really need to reclaim that 4016$ level to clear that resistance area and have almost a clear sky until the 4137$ level, which is around 2.90% above.
On the downside, I really want the 3964$ level to hold going forward, otherwise, I would consider the rollover scenario on this false channel breakout.
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
We just had the channel breakout we were waiting for on ES_F, and many things under the hood are also looking very bullish in my opinion.
The VIX just made a new cycle low and Aug. 19/20$ low is within reaching distance.
DXY & the 10Y just got rejected at the 10dma and are now below all kma’s.
XLE, SMH, and TAN are really the leading sectors and made good bounce and DTL breakout today
Many other sectors just bounced from the important area and might set up. XBI, IGV, XLV, etc.
Breadth: Stocks > 200-50-20 are showing very positive bounces and even a BORS on Aug high for the 200dma.
NNH & A/D is also showing constructive action
And more importantly, we are seeing more & more individual names showing very constructive action and holding the recent day’s breakout.
Despite the fact that I see all these positive things, I always keep ready for both scenarios, especially with important news tomorrow and the fact that we are on a Holiday & a small week on low volume.
Note that we are still in a very news-driven market and the geopolitical risk is very high with everything going on right now in the world. The latest that might have some impact is the Covid situation in China.
Gameplan:
I increased my exposure where I wanted and got into AEHR like I wanted as well, so tomorrow will be a day of managing my open positions and probably taking trades that I will close EOD to keep my exposure between 50%/60% going into the long Thanksgiving weekend.
PORTFOLIO UPDATE
INTRADAY/CLOSED TRADES:
LONG FOCUSLIST
INSW 46.99, SLB 53.89, LULU 355.59, SMCI 89.69, TH DTL+14.19$, ZETA DTL, HLIT 14.91,
INSW
Leading names in the past few months while trending and respecting the 21dma. We are now retesting that 21dma, so this might be a good spot to initiate a position for the next leg up. The DTL is where my alert will be.
UPDATE: Tried to breakout but got rejected at the entry pivot today. I’m keeping it in the FL for tomorrow on a possible 2nd attempt.
ALERT: 46.99$
SLB
Energy stock with an initial 60% leg that led to a consolidation in the last few weeks. We retested the 21dma Friday and bounced pretty hard on it. We also broke out of last week's channel, so a reclaim of the initial base breakout swing high would get me in.
UPDATE: 21dma retest again today and was not ready to push above the entry pivot, might be tomorrow.
ALERT: 53.89$
LULU🎖️
Retail names have been pretty strong lately and I really like that chart with a 10dma retest following the recent base breakout. Notice the channel we’re working in and that we were not able to breakout today.
ALERT: 355.59$
SMCI🎖️
Potentially the leader in the semiconductor sector already being at ATH. I don’t have exposure in this sector outside of AEHR, so I want to add this potential TML in a leading sector tomorrow if we reclaim the recent swing high pivot.
ALERT: 89.69$
TH🎖️
This name is a regular in the FL and is now setting up for a larger base breakout, just like the whole sector (XLV). After breaking out of the WB, we retested the 21dma and we are not trying to push the recent structure DTL & swing high. If we do, I think we have a good chance to breakout of that multi-month base.
ALERT: 14.19$ + DTL
ZETA
Software name that I traded last week is setting up for a potential stage 1 base retest setup. I would be ready to enter the DTL to confirm the potential continuation of this PB play.
ALERT: DTL
HLIT
A stock that was very strong before the earnings’ bad reaction is not setting up for a potential entry following the 50dma retest & higher lows. We broke that DTL and made a good thrust and now pulling back to retest the kma’s. I’m looking at the mini-channel breakout and recent swing high reclaim for an entry.
ALERT: 14.91$
🎖️ = Alex’s highest conviction setups
SHORT FOCUSLIST
SECTORS PERFORMANCE
(XLE) Energy - Solid follow-through on yesterday's reversal at the key level. We are now pushing for the base breakout again. Tomorrow should be interesting here.
(XBI) Biotech - Interesting UTL reversal today right in the base area. This is quite choppy lately, but if we reclaim the 81.75$ pivot I think we have a chance to push higher. That’s a trade that I will be looking at for tomorrow via LABU ETF.
(SMH) Semiconductors - Leading sector. Today 10dma bounce & channel DTL breakout that might confirm continuation tomorrow.
(IGV) Software - Found support right at the kma’s and base area bottom level. We held where we had too, now can we push higher?
(TAN) Solar - Leading sector. 10dma bounce and looks ready to resume higher with a reclaim of 83.10$ pivot first.
MARKET BREADTH & INTERNALS (RISK MODEL)
NYHL (New 52W Highs - Lows) - oscillating around with a positive reading today.
Trend @ -30 (⬆️)
NYAD (Net Adv/Decl) - In the last 2 weeks, we are seeing a real compression and squeezing action here. We’ll break one side or the other and this will probably be powerful and give the market direction.
UPDATE: breakout on the upside…let’s see!
20dma @ +272 (⬇️)
MMTH (Stocks > 200dma - LT breadth) - channel breakout at the 10dma & Aug high level.
MMFI (Stocks > 50dma - MT breadth) - Channel breakout at the 10dma today.
MMTW (Stocks > 20dma - ST breadth) - Bounce at the UTL, but still in larger wedge.
VIX (Volatility S&P 500) - VIX continues to trend lower and now closed just below the current cycle low, which is a pretty important price action after another 10dma rejection. This really gave me confidence in keeping exposure tonight AGAIN and I think gives us an indication that we might continue tomorrow. Of course, it can turn rather quickly with all the news tomorrow.
DXY (US $) - 10dma rejection, back below all kma’s.
US10Y/TNX (US 10Y bond yield) - 10dma rejection, back below all kma’s.
ECONOMIC & EARNINGS CALENDAR
PRIME MODEL SPREADSHEET (PT_database)
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LEADERS LIST
Overall leaders (PRIME Score)
AEHR,PR,SMCI,PDD,ASC,RCL,ELF,VAL,GPS,BIIB,CHGG,PARR,DHT,WFRD,MUR,INSW,CVI,SHLS,TNK,HP,
Fundamental leaders (FA Score)
RES,SIGA,NOG,PSX,ASC,DRH,TNK,ESTE,LTHM,CPE,CALM,PDCE,SWAV,RUN,MUR,PR,HGV,SM,TRIP,ERF,
Technical leaders (TA Score)
GPS,AEHR,RCL,ELF,SMCI,PDD,BIIB,PR,SHLS,VCYT,LPG,WFRD,CHGG,ASC,VAL,AEO,TGTX,PARR,CPRX,NAT,
Relative Strength 1 Month (1M-RS)
TGTX,AGEN,SHLS,AMRS,RUN,AEO,GPS,VCYT,YMM,BAND,BZ,SPWR,CHWY,LSCC,CENX,WE,JD,EGHT,CELH,ACVA,
Relative Strength 3 Month (3M-RS)
WFRD,ASC,INSW,BIIB,RCL,GPS,CCRN,ELF,YPF,CHGG,TASK,CHX,AEHR,XPRO,PR,TNK,SLB,VAL,LPG,DHT,
Relative Strength 6 Month (6M-RS)
AEHR,ELF,ASC,INSW,CCRN,WFRD,CPRX,BIIB,YPF,GPS,CHGG,TNK,DHT,PR,SMCI,CHX,SHLS,PDD,ARRY,STNG,
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