Alex's daily Market update & Focuslist - 06/25
Pullback continued with a 6th down day in a row, and weakening breadth
Good evening guys,
Enjoy tonight’s letter!
Alex ✌️
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GENERAL MARKET ANALYSIS
NASDAQ (NQ_F) Daily
Price Action Analysis:
NQ was not able to follow through higher last week while already very extended. Despite all week's selling, we still finished with an inside week.
We’ll see this week if this one is only a short PB, and we’ll find support quickly before making a new high or following through and testing levels further below.
Watching 15475$ for an upside continuation, and 14803$ as potential support if we keep pulling back.
We are now 7.4% above the 50dma. We are still extended.
We remain in a strong uptrend, above all kma’s.
RUSSELL 2K (RTY_F) Daily
Price Action Analysis:
Small-cap & RTY got hit way harder last week as we closed back below the two prior weeks’ range and back below the 30wma.
We are retesting the recent range area, which could act as potential support for a retest & bounce.
We are still seeing LOWER HIGHS and very choppy price action in the last months. No uptrend was established in small caps.
S&P500 (ES_F) Daily
Price Action Analysis:
Reversal week, so we’ll see if we can bounce and get an upside continuation above 4485$, or we follow through and pull back deeper, maybe down to the 10wma or even a retest of the recent stage 1 base area.
PT_UL BREADTH & INTERNALS
Price closed DOWN (-1.49%) and closed below the 21dma.
Breadth was NEGATIVE and accelerating (-335), with a NEGATIVE U/D volume.
MSCI downtrend + BELOW 10dma.
MOMENTUM was negative again today (record low since tracking at 0.1), with the 10-day ratio going negative.
NNH at +4 (28th in a row, but weakening again)
Bottomline:
PT MODEL = GREEN market signal (🟩) on PULLBACK (🟥).
We were not able to get a green breadth reading all week, and we closed it very weakly with a high negative breadth reading. We now have a deeper pullback than anticipated, as we are losing a lot of participation, price & momentum in the last six days.
We might need more time to digest the recent uptrend and high extensions in the major indices. The model is in RISK-OFF, and we’ll have the green light when things turn around. The trend remains UP, but we need to be patient!
Internals
MOVE (Merrill Lynch Option Volatility Estimate - Bond market volatility)
We remain below the weekly DTL but are certainly in a pivotal area.
1.56 & 30wma reclaim last week was a red flag. We’ll see if we follow through or not this week.
BTC/USD (Bitcoin)
BTC closed the week very strong, just below the 31050$ recent swing high pivot. If we can reclaim that level this week and push above, we’ll have a new high and an uptrend continuation confirmation.
SECTORS ANALYSIS
We saw serious selling last week, with A LOT of bearish outside weeks in the Subsectors ETF charts. None of the sectors closed positive for the week.
Large-cap resisted best to the pullback so far.
Healthcare, Consumer Disct. & Communication services did well last week, despite being negative. XLV, XLY, XLC.
Themes & Subsectors
DAILY LEADERS (top10)
BLOK XHB GDXJ SIL GDX IHF IHI PBJ PXE PNQI
WEEKLY LEADERS (top10)
BLOK IHF XHB IHI EVX PNQI VICE XRT PJP PBJ
% from 52w LOW (top10)
PSI AIQ SOCL BLOK PNQI XHB PXJ COPX ROBO ESPO
% from 52w HIGH (top10)
XHB EVX PPA PNQI IHI VICE GRID PSJ NXTG AIQ
Leading sectors:
SMH Semiconductors: Bearish outside reversal last week. (Closed below prior week’s low) This is not a great price action, and follow-through is likely. I’ll watch the 143.80$ level for potential support this week.
IGV Software: Red week, but we were still below-average volume and inside week. I’ll look prior week's high + low pivots for a direction confirmation.
CIBR Cybersecurity: Reversal, but also on low volume and inside week. Looking at prior week’s high & low pivots for confirmation.
ITB Home Builders: One of the few themes closing GREEN for the week. The strong uptrend continues.
XLY Consumer discretionary: Inside and almost flat week. Strong action.
FOCUS & LEADERS LIST
ATEC - ALPHATEC HOLDINGS, INC. (wBO10PB) - Alert: 16.55, SL: 14.99
Leading sector (Medical Devices (IHI))
Lot of RS last week.
10/30wma aligned & uptrend
Just bounced from 10wma, but still not extended.
183% prior uptrend
16 weeks base & consolidation
Higher lows prior to potential breakout
2.38 U/D ratio
DKNG - DRAFTKINGS INC. (wBO10PB) - Alert: 25.79, SL: 24.16
Leading sector (Consumer Disc. (XLY) + Gaming (BJK))
Lot of RS last week.
10/30wma aligned & uptrend
At 10wma.
137% prior uptrend
6 weeks base & consolidation
Higher lows prior to potential breakout
1.55 U/D ratio
Z - ZILLOW GROUP, INC. (BREAKOUT) - Alert: 48.92, SL: 46.6
Leading sector (Communication Services XLC + Internet PNQI)
Lot of RS last week.
10/30wma aligned & uptrend
Just bounced from 10wma, but still not extended.
88% prior uptrend
19 weeks base & consolidation following the stage 1 base breakout
Higher lows prior to potential breakout
Bad fundamentals, so there is less conviction in the name. But the chart is constructive and just coming out of stage 1.
1.65 U/D ratio, with only high volume green weeks since the bottom in 2022.
TPR - TAPESTRY, INC. (WBPB) - Alert: 44.38, SL: 41.89
Leading sector (Consumer Discretionary XLY, but not leading THEME - Luxury LUX )
10/30wma aligned, squeezed & uptrend
It just bounced from 10+30wma, but still not extended.
72% prior uptrend
5 weeks base & consolidation following the weekly DTL breakout
Higher lows and surfing the kma’s before the potential breakout.
1.28 U/D ratio.
HUBS (BREAKOUT) - Alert: 530.69, SL: 500.01
Leading sector (Technology XLK + Software PSJ)
Lot of RS last week. (compared to market + group)
10/30wma aligned & uptrend
Still a bit extended from the 10wma. (6/7%)
92% prior uptrend
3 weeks consolidation only.
Higher lows in last 2 weeks.
1.58 U/D ratio.
INDICES/SECTORS:
IHI - iShares:US Med Dev ETF (BREAKOUT) - Alert: 56.35, SL: 55.01
(TMO ABT MDT ISRG EW SYK BSX DXCM BDX IDXX)
Stage 1 base breakout.
BLOK - Amplify Trans Data Shrng (BREAKOUT) - Alert: 21.81, SL: 20.36
(MSTR MARA ACN COIN OSTK CLSK SQ RIOT HUT IBM)
Stage 1 base breakout.
LEADERS LIST
Overall leaders (PRIME Score)
RCL,IMGN,MARA,CCL,MDB,SDGR,VRT,NVDA,SOFI,NCLH,PLTR,CELH,SMCI,XP,NVTS,EXAS,IOT,APP,META,RIOT,
Fundamental leaders (FA Score)
RCL,ELF,NCLH,CELH,TMDX,DT,WNC,HTGC,SDGR,WYNN,EXAS,FUTU,CRSP,ALGM,ARRY,CSIQ,ALB,MGM,PANW,EQC,
Technical leaders (TA Score)
IMGN,MARA,MDB,CCL,XP,VRT,NVDA,PLTR,SMCI,RCL,META,APP,RIOT,IOT,SDGR,SGH,SOFI,NVTS,TSLA,CELH,
Relative Strength 1 Month (1M-RS)
SOFI,COHR,MARA,CCL,IMGN,FIVN,TSLA,PSTG,GTLS,MDB,NCLH,AEHR,GH,COIN,PLAY,VRT,RCL,SNOW,GTLB,MSTR,
Relative Strength 3 Month (3M-RS)
IMGN,XP,SMCI,VRT,MDB,CCL,PLTR,CELH,SDGR,APP,MARA,SGH,LEGN,RCL,TGTX,RILY,CFLT,NVDA,EXPI,BILL,
Relative Strength 6 Month (6M-RS)
IMGN,MARA,SMCI,TGTX,RIOT,NVDA,APP,PLTR,SDGR,NVTS,META,MDB,CCL,XP,RDFN,VRT,RCL,DKNG,ACVA,IOT,
Alex’s TAKEAWAYS & GAMEPLAN
The market pullback started last week, and we saw continued selling all week, with an acceleration of a breadth deterioration on Friday to close the week.
I notice a lot of bearish reversals in the sectors & themes charts, which puts me on the defensive.
After the recent run, a pullback was expected, and still very normal & healthy. We don’t know how deep & long it will be, so we must remain careful to wait for the market to tell us the signal it’s turning back up and buying starts again before engaging the market, IMO.
For me, I’ll want to see my PT_MODEL show price action, breadth & momentum turn back up, and resumes the uptrend. Until then, I remain on the sideline for the confirmation of a high-probability market.
GAME PLAN:
Exposure model = GREEN market signal (🟩) on PULLBACK (🟥).
SIDELINE and only managing open positions until the PT_MODEL confirms the end of this pullback. (Price, Breadth & Momentum confirmation)
Economic news/events:
PORTFOLIO UPDATE
INTRADAY/CLOSED TRADES:
PRIME MODEL SPREADSHEET (PT_database)
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REFERENCES
Articles on the system:
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