Alex's daily Market update & Focuslist - 01/23
The market follows through on Friday’s bounce
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Alex ✌️🙏
GENERAL MARKET ANALYSIS
S&P500 (ES_F) Daily
Price Action Analysis:
The market follows through on Friday’s bounce.
ES_F opened right at the range high pivot of Friday’s close and quickly found buyers at the open to push above the 4016$ level and the bear market DTL… two important levels.
After a failed breakout in the afternoon, the market came under pressure, retested the 4016$ level, and found support to finish the day strong. The market is respecting price structure, and buyers are stepping in on pullback…this is all very healthy behavior.
Overall, this is very constructive and adds a lot of conviction to the thesis that the market is improving and possibly a bull market is developing. (I’m not talking about a multi-year bull, only a bull trend until we get bearish signals)
On the upside,
4082$ on ES_F will be a pretty big potential resistance level for tomorrow.
On the downside,
The bear market DTL and the 4016$ level will be important level to find support and the market comes under pressure again.
NASDAQ (NQ_F) Daily
RUSSELL 2K (RTY_F) Daily
In the following sections of tonight’s letter, I’ll cover essential parts of my daily routine & preparation for tomorrow’s trading session.
✅ My overall current market Takeaways & GAMEPLAN for tomorrow
✅ PRIME_LIST (top 5 potential TML’s)
✅ My daily Focuslist, including setups, alert levels & explanation (LONG/SHORT)
✅ My Portfolio update
✅ Sectors Review
✅ Market Breadth & Internals
✅ Economic Calendar
✅ Prime Model spreadsheet (PT_database)
✅ Leaders list (technicals, fundamentals & potential TMLs)
Alex’s TAKEAWAYS
The market followed through on Friday’s bounce…which confirms the “healthy” pullback thesis and adds a lot of conviction to this market.
We are also seeing many base breakout holding in the last few days, which we didn’t see happening in 2022. That’s a character change.
Overall, I remain positive about this market. As long we see pullback being bought, individual names showing constructive action, and my position holding…I’ll continue to play this rally, bull, or whatever you want to call it.
Some observations:
ES_F FOLLOWED THROUGH on Friday’s bounce, breaking the bear market DTL and the 4016$ level.
Breadth continues to improve.
Leading names follow through as well, and we are seeing more & more quality setups showing up.
VIX < 20
DXY (US$) - rejected at the 10dma and pushing lower
My MT_SIGNAL (McClellan sum. index & 10dma) is in CONFIRMED UPTREND.
My LT_SIGNAL (Cumulative new 52W H/L & 50dma) CROSSED the 50dma and confirmed a BULL market signal.
Market health & Trend indicators:
LT_SIGNAL: uptrend (black) + ABOVE 50dma = BULL market developing (🟩)
MT_SIGNAL: uptrend (black) + ABOVE 10dma = UPTREND (🟩)
Tomorrow's economic news/events:
GAME PLAN:
I continue to build long exposure as long my positions are gaining traction and give me profits to finance that new risk. (progressive exposure)
EXPOSURE MODEL:
PRIME_LIST (NEW)
AEHR FOUR ARRY SHLS MELI
AEHR: Extended
FOUR: No entry yet
ARRY: I’m in it and playing the base breakout
SHLS: Base breakout with the 26.90$ pivot breakout today. We might retest it tomorrow, but overall very strong action and might be the leading solar name right now.
MELI: resistance around the base top, but quite extended. no low-risk entry yet.
FOCUSLIST (LONG)
APA 46.14, BAND 23.18, EVH 32.39,
APA - Alert: 46.14, SL: 43.36
If the energy sector is trying to breakout from that base tomorrow, APA could be one to watch on this long retest of the base area. We made another higher low today, just below the DTL. Tomorrow is ex-div, so this might affect the PA.
BAND - Alert: 23.18, SL: 21.75
This was one of the strongest stocks until that news last week. This finally acted like a nice shakeout as we never made a new low and held the support area bottom level. We reclaimed the 50dma today, and I will be looking at the same pivot I used to enter last week.
EVH - Alert: 32.39, SL: 30.36
Multi-month wedge breaks, and we just made our first pullback at the 10dma. I will be looking at the recent swing high to confirm continuation.
PORTFOLIO UPDATE
INTRADAY/CLOSED TRADES:
SECTORS PERFORMANCE
Leading sectors:
(SMH) Semiconductors - Strongest sectors right now. We broke to a new high above the 234.59$ level on volume today. 246.76$ is my next ST target.
(TAN) Solar - Very constructive bounce from kma’s today, and pushed back to the resistance level we rejected last week. Will it push above or reversed again..? A big question for tomorrow.
(XBI) Biotech - Unchanged today and still building that wedge from the past few days.
(GDX) Gold miners - Another 10dma touch and bounce today. The trend is still intact, and I’m watching a 32.75$ pivot breakout for continuation.
(XLE) Energy - Failed at last Wednesday's high pivot.
(XME) Metals & Mining - Not able to follow through today.
(XRT) Retail - Retail is really strong lately and now trying to breakout from the stage 1 base, which would be very constructive action to confirm a new uptrend.
(IGV) Software - Another stage 1 base breakout on volume in Software…this is getting interesting as a first step in the right direction.
MARKET BREADTH & INTERNALS
$NYHL (Cumulative new 52W Highs/Lows & 50dma)
CROSSED the 50dma and confirmed a BULL market developing signal
LT_SIGNAL: uptrend (black) + ABOVE 50dma = BULL market developing (🟩)
!MCSUMNYA (McClellan summation index & 10dma)
MT_SIGNAL: uptrend (black) + ABOVE 10dma = UPTREND (🟩)
$NYMOT (McClellan Oscillator - Breadth extensions)
NYHL (New 52W Highs/Lows) - Improving and following through on Friday’s reversal.
NYAD (Net Adv/Decl) - Another 1000+ day, breadth is strong.
MMTH (Stocks > 200dma - LT breadth) - Follow through today, looking at 55.31 prior swing high to confirm continuation.
MMFI (Stocks > 50dma - MT breadth) - DTL retest today. Tomorrow we’ll know if we reject it or breakout here. Big day IMO.
MMTW (Stocks > 20dma - ST breadth) - Still in that overbought area, but not extreme. Still room to wedge around here IMO.
VIX (Volatility S&P 500) - Living below the 10dma, but still above the 18.50/19.50$ important area.
DXY/TNX (US$) - Still below all kma’s and pushing downward.
ECONOMIC & EARNINGS CALENDAR
PRIME MODEL SPREADSHEET (PT_database)
Access to the PT_database 👇
LEADERS LIST
Overall leaders (PRIME Score)
AEHR,FOUR,NINE,ARRY,SHLS,H,MELI,RCL,PR,OII,RUN,VAL,CCL,TGTX,HGV,ALGM,PARR,JXN,UAL,ONON,
Fundamental leaders (FA Score)
NOG,FRO,CALM,PR,ESTE,LTHM,CPE,RUN,AEHR,HGV,TRIP,GFS,JXN,LBRT,DVAX,CEIX,DK,LNTH,ABNB,PBF,
Technical leaders (TA Score)
TGTX,ARRY,OII,AEHR,MELI,FOUR,SHLS,NINE,RCL,ALGM,CLF,CCL,ONON,RMBS,LSCC,H,GPS,VAL,MNDY,EXPE,
Relative Strength 1 Month (1M-RS)
CHPT,EXPE,MELI,BLNK,LTHM,CCL,CLVT,CNK,AAL,ONON,LC,UAL,ABNB,DKNG,TSLA,BTTR,NCLH,TOST,TGTX,CPE,
Relative Strength 3 Month (3M-RS)
NINE,TGTX,BAND,OII,AEHR,ARRY,LSCC,ALGM,CPRI,CSIQ,RMBS,FOUR,KLAC,NLY,SHLS,WMG,RUN,IGT,TOL,SPR,
Relative Strength 6 Month (6M-RS)
NINE,AEHR,TGTX,OII,ARRY,BAND,FOUR,RMBS,RCL,PARR,SHLS,VAL,ALGM,PR,JXN,CPRI,LSCC,CSIQ,IGT,GPS,
REFERENCES
Articles on the system:
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