Alex's daily Update & Focuslist - 08/01
Good evening folks,
Tonight's letter is a bit later, we were enjoying a nice cabin in the woods all day and came back late. EC full, let’s dig into it!
A pretty uneventful day overall as the market was not able to either push higher or sold off to finally close unchanged.
I will still be looking at the same levels as yesterday.
On the downside, we want to see NQ hold the 12801$ level along ideally the 5dma. I would not get too surprised if we get 1-3 days of consolidation above or a bit in that support area before finding more support to push higher.
On the upside, the next level I’m watching is 13184$ which is the next potential important resistance area. That’s a 1.9% move.
Remember that we are in a bear market, and we are playing a rally, which means the market can roll over anytime despite the good action we are seeing right now. 🛡️
We are now in my bullish scenario until further red flags or consolidation.
I give some leeway to the market to consolidate in a healthy manner before switching to a bearish scenario. Remember, the market & stocks don’t move in straight lines. We have a rally, watch how we react on the pullback and especially on the kma’s retest.
CLOSE below 12578$
CLOSE below 50dma
Reduce long exposure and treat this reversal as a potential rollover
MMFI (Stocks > 50dma) - Gapped down and managed to close above the March rally high again today. Nothing to worry here as we’re still above the 5mda, the trend is strong.
VIX - A spike on VIX today, but we are still below our DTL and also got rejected the 10dma earlier today. As long we stay below that DTL and also the 24.33$ level we’re watching for a while, I think this is healthy action for now.
USD/CAD - Finally found support at the support area bottom and broke the DTL as well. We are still below the 50dma.
HYG/IEI (Credit Spread) - Nothing to worry here.
BTC/USD (Bitcoin) - Consolidate right below 24280$ important level but still above the 50dma. We are still on low volume and above kma’s, healthy action so far.
ECONOMIC & EARNINGS CALENDAR
(SMH) Semis - Still grinding higher above the 5dma and our recent 232.14$ pivot. No red flag here
(TAN) Solar was Consolidation today with an inside day. This is just normal pullback action as we are indeed very extended from kma’s. The volume is also very low compared to the last 3 days’ action. No red flag.
(XBI) Biotech - XBI Lagged again today and has been rejected by 10&21dma today as it tried to put a reversal from the recent consolidation area bottom level. Not the best action in here for a recent leader, I would say we are at risk here tomorrow…
CL_F (Crude Oil) - The move-down I talked about last night has materialized today with a 5% down day. We broke the DTL and went straight at the support area bottom, which doesn’t seem like good support anymore.
Leading names are holding key levels & breaking out (+)
NQ with a range day but holding levels (=)
Potential important resistance on NQ, SMH & TAN are at a good distance, we might see more strength to open the week before pulling back IMO. (+)
SMH (Semi’s) but TAN consolidating (=)
Market breadth retest & continuation. (NNH,>50dma, etc) (+)
Speculative consolidating (Bitcoin) (=)
USD & VIX spiked up (-)
2Y & 10Y bond yield selling off (+)
Crude oil (CL_F) broke DTL and selling pressure was high. Now back to support area bottom (+)
Overall leaders (PRIME Score)
Fundamental leaders (FA Score)
Technical leaders (TA Score)
Relative Strength 1 Month (1M-RS)
Relative Strength 3 Month (3M-RS)
Relative Strength 6 Month (6M-RS)
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