Good evening traders! 👋
What we’ll cover in the Newsletter tonight:
General market analysis ($NQ/$ES levels)
Market Breadth & Internals
Prime Model spreadsheet (PT_database)
Economic Calendar
Sectors Review
Leaders list
Alex’s Portfolio update
Focuslist including setups, alert levels & explanation
GENERAL MARKET ANALYSIS ($NQ/$ES levels)
NASDAQ ($NQ) Daily
Pretty crazy h
We’ll have to see if we can get follow-through from that bounce and undercut & rally setup, but as usual, I’m following price action and will go where the market goes.
$NQ levels on the upside
11689/11794$ resistance area
12017$ Sept. structure
the 21dma
$NQ levels on the downside
11534$ level (June structure)
11229$ previous swing low pivot
11285/11068$ area (June low level)
S&P500 ($ES) Daily
$ES levels on the upside
3855/3903$ area from Sept. & June/July structure
the 21dma
$ES levels on the downside
3735/3780$ area that we just breakout
3639$ last week swing low pivot
3596$ level (2020 structure)
MARKET BREADTH & INTERNALS
NYHL (New 52W Highs - Lows) - The market breadth continue to improve and we’re seeing more & more new highs. NNL now @ -48, let’s see if we can turn positive tomorrow.
NYAD (Net Adv/Decl) - We just had the second highest advances thrust of the year and 2 back to back. That’s very interesting…
20dma @ -238 (⬆️)
MMTH (Stocks > 200dma - LT breadth) - A huge thrust here as well as we opened at the 21dma and pushed more than 25% higher to finally closed above 25% pivot and almost at the 50dma. That’s a BIG one-day push…
MMFI (Stocks > 50dma - MT breadth) - Another big 60% move here as we pushed above the recent support area and closed above the 10dma and right at the 21dma. We are getting into potential resistance, but still very constructive.
MMTW (Stocks > 20dma - ST breadth) - ST breadth improved by 130% today… with a break above all recent structures and a close above the 50dma. That’s really impressive moves we see in all breadth indicators tonight. ST, MT & LT all with big thrusts.
MCOSINYA (McClellan Oscillator) - McClellan oscillator turning positive and trending up for the last 3 days. Now @ 85.94.
VIX - That’s the kind of action that we’ll want to see if we really continue this rally (nothing is sure). A slow drift down with small spikes at the kma’s along the way. This is the first step today, but we still have work to do in order to get below those kma’s.
PCCE (PUT/CALL EQUITY RATIO) - 0.841
DXY (US $) - US$ with a big break below the recent UTL and the 21dma. This was a 1.3% move down, which is a big deal. We approach the 109.97$ pivot that was important a few weeks back, so we’ll have to see in the next few days if we can find support or continue this trend down. (trend down here = good for the market)
US10Y (US 10Y bond yield) - 10Y is finding support for the 2nd day at the 21dma today. We’ll have to monitor this one closely tomorrow as it can put some pressure on the market.
IEI/HYG (Credit Spread) - Credit Spread with a REALLY POSITIVE action today… big 1.92% down move below ALL KMA’S and back into the support area on volume. Clearly today, no ST risk was priced in this market.
BTC/USD (Bitcoin) - BTC with an interesting move here. We broke above the 21dma and the recent base area top level. Volume is increasing and we are right at the 50dma, which could be a big deal to breakout. Risk asset waking up could be a good sign to support the rally thesis.
PRIME Model spreadsheet (PT_database)
In the last few years, I've developed a model based largely on #CANSLIM fundamentals characteristics to focus on the best stocks. Not having the money to afford a #MarketSmith sub at the time, I built my own fundamental & technical scoring system into an Excel spreadsheet
PRIME Model explained
Starting from today, that's something that I will share daily here as added content to the paid part of the newsletter. So make sure to subscribe if you want to get that access on a daily basis!
Free access to my PT_database 👇
Use wisely, and enjoy!
This was a FREE preview of my daily Market update & Focuslist letter. In the following sections, I’ll cover important parts of my daily routine & preparation for tomorrow’s trading day that you don’t want to miss!
Economic Calendar
Sectors Review
Leaders list
Alex’s Portfolio update
Focuslist including setups, alert levels & explanation
If you’d love to read about 5 such posts every week, then subscribe below to join the PrimeTrading community!
ECONOMIC & EARNINGS CALENDAR
SECTORS PERFORMANCE
Sectors Relative Strength - Weekly (RS vs SPY)
Top 3: XLE - XME - ITB
(XBI) Biotech - XBI confirmed last night's setup with a nice gap up and breakout of the recent support area 81.75$ level and closing above all kma’s. I am playing this potential leading sector with LABU as explained yesterday.
(XLE) Energy - Energy is still super strong and we now reclaimed the stage 3 base area. We are sitting right at LT DTL from June’s high. If we breakout off that DTL tomorrow, we could be looking at a potential multi-month move IMO.
(XME) Metals & Mining - XME continue to act super strong with a pretty big gap up and close above the 50dma. We are still in that stage 3 base area, but pretty close to reclaiming it, maybe tomorrow?
(XLV) Health Care - XLV saves the breakdown and is now back above the stage 3 base area as well. We closed above the 21dma and right at the 50dma. This will be either resistance tomorrow or we breakout and continue higher.
(IGV) Software - Another sector saving the day with a stage 1 base area reclaim and close above the 21dma.
(TAN) Solar - Solar with a big gap up, but we were not quite able to hold the gains with a 21dma rejection. We still closed above the stage 1 base area, so we’ll have to see if we hold it tomorrow or we’re looking at a rollover at the 21dma.
Alex’s TAKEAWAYS:
This is getting interesting, and we have to be super careful at the same time. We just had 2 very powerful days on the indices, backed by solid breadth thrust underneath….but we are now heading into potential resistance. It will all come to see if we see a sustained rally or not at this point.
I would not be very surprised if we find some resistance tomorrow or the day after and pullback on the indices. I am waiting patiently to see that first pullback/stress test to see if we are finding buyers and if we see a controlled selling along the way down…or if we rollover from there.
We are still in a bear market, but we’ll follow price action as usual and the tape will tell us if this rally has more legs or not! One day & one level at a time!
Always stay open, but do not anticipate!
LEADERS LIST
Overall leaders (PRIME Score)
VLD,YPF,XMTR,AEHR,HLIT,CEIX,CCRN,RXDX,INSW,RVNC,WTI,SWAV,PAYO,RXRX,DEN,DCPH,SMCI,TH,WFRD,MPC,
Fundamental leaders (FA Score)
AMR,HCC,DK,MRO,ERF,DVAX,MGM,DRH,TELL,LBRT,BHF,ENLC,SWAV,TRGP,WTI,HLIT,MPC,FANG,KOS,ARCH,
Technical leaders (TA Score)
RVNC,RXDX,CCRN,YPF,VLD,XMTR,HLIT,PAYO,CEIX,MARA,AEHR,DCPH,RXRX,INSW,WFRD,WOLF,WTI,CROX,MRSN,SMCI,
Relative Strength 1 Month (1M-RS)
RVNC,CCRN,STNE,BVN,MARA,SG,RIOT,CPNG,PL,SKIN,SPWR,PYCR,AMN,BECN,ZETA,HLIT,RXRX,HOOD,KPTI,WFRD,
Relative Strength 3 Month (3M-RS)
VLD,MARA,TH,AEHR,YPF,RXDX,RVNC,STEM,WOLF,CPRX,RIOT,XMTR,BFLY,AMRS,ZETA,PAYO,FUBO,ARRY,IEA,IS,
Relative Strength 6 Month (6M-RS)
TH,CEIX,DCPH,INSW,STNG,STKL,SWIR,RXDX,RVNC,SMCI,ARLP,CCRN,ARRY,CPRX,MRSN,WTI,AEHR,CELH,XMTR,HRB,
PT PORTFOLIO UPDATE
Position management GAMEPLAN:
Position size: 1/2 positions max (10% of equity)
Position management
First trim: sell 25% initial position
Trim @ first day EOD
SL moved @ breakeven
2nd trim: sell 25% initial position - 10dma EOD break
3rd trim: sell 50% initial position - 21dma EOD break
Scale-out approach
Alex’s FOCUSLIST
LTHM 32.53, ON 70.89, SWAV 291.35, VLD 4.59+DTL, CHPT 16.6, RXDX 63.13
Almost 100% first leg up that led to a 50dma pullback in the last week or so. We built that led to a nice U&R setup today. I will be looking at the 31.53$ initial base breakout swing high & 21dma breakout as a potential entry.
UPDATE: We gapped up right above yesterday’s entry pivot, but closed below it. We are building a nice tight area above the 50dma, so I’ll be looking next at the recent swing high pivot for an entry.
Entry: recent swing high pivot @ 32.53$
Recent leading Semi’s name consolidated in a really controlled way just under the 50dma in a very nice tight area on low volume. I’ll be looking at this LT base area reclaim and the recent swing high for a potential entry.
Entry: recent swing high pivot @ 70.89$
SWAV 0.00%↑ 🎖️
One of those recent potential leaders’ names has recovered pretty nicely after that report/news created that undercut the 50dma. But we then reacted very well and now back above all kma’s. I see a retest of the area yesterday and a BORS confirmation today.
Entry: reclaim swing high pivot @ 291.35$
VLD 0.00%↑ 🎖️
One of the most interesting setups right now. Huge 370% first leg from the lows and recently a nice consolidation above the 50dma. This is still a pretty volatile and low float stock, but I really like the fundamentals and the way we contracted in the last few weeks. Could be a big winner.
Entry: recent swing high pivot @ 4.59$ + DTL
PBW sector has been super strong today and CHPT was a name that was outperforming the market in the last few weeks before getting hit by the market PB. We just breakout of a tight area just below the 50dma and closed above all kma’s. I’ll be looking at a breakout of today’s high to confirm the stage 1 base reclaim.
Entry: stage 1 base reclaim candle high @ 16.60$
Biotech sector is one of the leaders right now and RXDX just had a nice base breakout that we came to retest the b/o area in the last 2 days. I like how we are holding that level and the 5dma on a name that was held amazingly in the last few weeks.
Entry: recent swing high pivot @ 63.13$
🎖️ = Alex’s highest conviction setups
NOTE: I have the discipline to build a detailed FocusList each night, but I want to emphasize that I DON’T take all the trades that would trigger their entry. Some reasons to take a specific position over another, or not take any trade even if the alert is activated, are:
The general market price action
My Market-Based exposure model
My Portfolio-based exposure model (progressive exposure)
A high conviction setup
Price action around the entry pivot
Then even if I take a trade at the entry pivot, I will very often sell it right away if the market roll over or the stock is backing out of the gate. I prefer to re-enter on the entry pivot reclaim than to be stuck with a larger loss. Please study closely all my education articles to learn how I handle trades around these entry pivots.
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REFERENCES
Articles on the system:
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