Good evening folks,
Hope you had an amazing decoupling day! We are seeing some very interesting action in the leading names, while the indices continue to pullback. Let’s see what tomorrow can bring us!
✌️🛡️
MARKET REVIEW
Pretty flat day for $NQ as we tried to reclaim the 12963$ level, but got rejected a couple of times intraday.
We are approaching pretty important levels as we are less than 1% away from the 50dma and also the 12801$ important potential support. I will begin to search for a bottom at these levels as this is a confluence of pretty big potential support areas.
That being said, today reinforced my idea that we are living through a pullback and not a 3rd leg down. Many leading stocks acted very strong again today, like CELH 9.29%↑ breaking out of its recent consolidation and making a new ATH, but also names like AEHR 1.00%↑ that tried to breakout.
What are the levels I’m watching on NASDAQ tomorrow?
On the upside, we want to see a reclaim of the 12963$ level at least and ideally of the 13108$ level as well. and also a close above the 5/10dma would be really ideal.
On the downside, the next potential supports are the 50dma & the 12801$ support top area level.
MARKET BREADTH
MMFI (Stocks > 50dma) - Held the 66.60$ March top level and closed higher today. This is an area of potential support, so we’ll see if we can bounce from it tomorrow.
MMTW (Stocks > 20dma) - Tried to bounce from yesterday’s low and potential support area today, but finally closed lower.
VIX - VIX gapped up, and tried to reject the 50dma & 24.33$ level. We finally closed unchanged from the open and above the 50dma. This is likely going higher tomorrow, but we’ll see about that!
DXY (US $) - US$ found some resistance in that area as expected last night. Now is it only a pause to let the kma’s catch up a bit, or will we really reject this area?
US10Y (US 10Y bond yield) - 10Y still acting strong. No Bueno for growth stocks.
US2Y (US 2Y bond yield) - 2Y tried to reject the 3.30% base top level, but almost reclaimed it by EOD. A breakout seems likely for tomorrow if we don’t reject it with more strength…
IEI/HYG (Credit Spread) - Credit spread found resistance at the 50dma, but did not move much compared to the recent run-up. We’ll need more than that…
BTC/USD (Bitcoin) - Did not close red like the indices and reclaimed the 5dma and recent support area now acting as potential resistance. We’ll have to breakout of that area if we want to get a chance here.
NG_F (Natural Gas) - Was not able to hold the breakout today after some commodity news hit. I will give it a chance as we are still above the 10dma.
CL_F (Crude Oil) - Crude Oil WEDGE BREAKOUT and now trying to reclaim that resistance area.
ECONOMIC & EARNINGS CALENDAR
SECTORS PERFORMANCE
(SMH) Semis - Was able to hold the stage 1 base area, but got rejected by the 50dma. Not the best look, might need a couple days to consolidation here.
(TAN) Solar - Was able to reclaim the 21dma and 83.30$ support level today, but got rejected at the 5dma.
(XBI) Biotech - Good bounce on volume just above the 50dma & 84.63$ level. If we can follow through on this reversal, this would be good for the general market.
Let’s look at our 6 other sectors that just broke out of stage 1 bases
(CIBR) Cybersecurity - Saved the stage 1 base breakout on that retest and closed above the 21dma
(FDN) Internet - Still in that stage 1 base area, but got rejected by the 50dma. Not the best look, but still inside potential support.
(IGV) Software - Still in that stage 1 base area, but got rejected by the 50dma. Not the best look, but still inside potential support.
(XML) Metals & Mining - Acting very good with a 21dma reversal and closed above all kma’s. Best looking sector right now IMO. (apart XLE I’ll have to start following)
(XRT) Retail - Back to stage 1 base support area & 50dma.
(XLF) Financial - Not able to find support at the 21dma again today.
(XLE) Energy - I told you I’ll start to follow it right :) Strongest sector right now with a BORS setup on the stage 1 base breakout yesterday, then a follow through and big upthrust on volume today to confirm that retest.
Alex’s TAKEAWAYS:
$NQ was not able to reclaim the 12963$ prior low pivot, which is concerning along the 2Y & 10Y, VIX, Credit Spread, and the dollar spiking… this is not the best indices action and we might see more downside pressure in the coming days.
BUT AGAIN, we are still seeing very nice setups, and leading names are holding, building, and now breaking out of bases in a very constructive manner. It’s now a question to know if the market weakness will eventually drag them down with the rest, or will they breakout before everyone as the market will find a bottom. At this point, I am following the leading names until they show red flags as well.
LEADERS LIST
Overall leaders (PRIME Score)
SIGA,STEM,SWAV,TH,CELH,AEHR,CEIX,VLD,CPRX,NFE,HRB,SMCI,FLNG,AIV,STKL,SPWR,ARLP,CHS,INSW,BFLY,
Fundamental leaders (FA Score)
RES,AMR,HCC,DK,MRO,ERF,DVAX,MGM,DRH,TELL,LBRT,BHF,ENLC,SWAV,LC,TRGP,SLDP,WTI,MPC,FANG,
Technical leaders (TA Score)
SIGA,CPRX,TH,SWAV,STEM,CELH,AEHR,CEIX,PLUG,HRB,STKL,SPWR,NFE,CHS,SMCI,WOLF,BFLY,MRSN,AIV,VLD,
Relative Strength 1 Month (1M-RS)
FUBO,VLD,CLAR,CPRX,YPF,SIGA,PLUG,AZUL,BFLY,LAZR,CRK,OSCR,RKLB,STEM,ARCH,SMCI,HCC,WOLF,SWAV,PBF,
Relative Strength 3 Month (3M-RS)
TH,MRSN,AEHR,CPRX,SIGA,STEM,SWAV,PRVA,AGEN,ELF,BFLY,HIMS,ENPH,CELH,BKSY,VLD,PLUG,CHS,WOLF,BCRX,
Relative Strength 6 Month (6M-RS)
TH,SIGA,LNTH,NFE,CEIX,MRSN,STNG,ENPH,CRK,CPRX,STKL,SWAV,EQT,AEHR,PRVA,CELH,HRB,PBF,ARLP,CVI,
PT PORTFOLIO UPDATE
Tomorrow’s game plan:
I approach being fully invested and my plan will be to manage my current positions tomorrow and might open a new position if my current positions are acting well tomorrow. We are definitely entering a position managing period if these names are holding their SL.
Alex’s FOCUSLIST
AEHR 🎖️
Very powerful name that just made a 60% run in less than a month. I am looking at a potential HTF at the 10dma (BO10PB setup). We are building tight action above the 10dma with higher lows within this consolidation.
UPDATE: Breakout of the DTL & 18.29 pivot today, but might give another entry off the 18.77$ higher pivot tomorrow for those that missed the DTL breakout.
Alert - 18.77$
MRSN
Biotech name that came back to retest the 10dma today before closing above the DTL I was eyeing for a few days now. We are still within the base & consolidation, so a breakout of the 8.02$ pivot would confirm the BO10PB and continuation higher.
Alert - 8.02$
ON 🎖️
A recent semiconductor leading name that is now building VERY CONSTRUCTIVE action right above the recent base breakout area. I also like the current higher lows right at that level. That’s a name that I am trying to get in for a while (very good fundamentals) so I will put a stop order on this name tomorrow on this high conviction setup.
Alert - 71.98$
TH
A name that shake me out yesterday on that nasty reversal, but acted very good today with a reversal and reclaim of the 14.08$ pivot. A breakout of the 14.86$ pivot would certainly be the last chance to get in before this leave the station. Still a leading stock IMO.
Alert - 14.86$
LTHM 🎖️
A recent very strong stock with a 60% run from the lows is just setting up a BORL right at the base support area. We were able to hold that area and even shake out a bit below it. A move above the 31.08$ recent swing high pivot would confirm the setup for me.
Alert - 31.08$
TELL
A name that was in the FocusList last week and that I still have a position. We are now seeing a BORS setup as we retested the base 1 support area today. We are building a consolidation in the last 2 days and if we reclaim the 4.72$ level we would confirm continuation higher.
UPDATE: Still have my position but that 4.72$ pivot is still in play IMO. We came back below on that Nat Gas news that hit this afternoon. If NG reclaims that breakout, we could see the same action with a 4.72$ pivot reclaim and continuation on this name.
Alert - 4.72$
🎖️ = Alex’s highest conviction setups
REFERENCES
Articles on my system:
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A great update and game plan as always Alex! 🙏