Good evening folks,
Last week was no joke with a lot of choppy action, but we finally triggered my bullish scenario Friday and closed the week really strong!
Let’s see if we can follow through and continue this potential rally.
Let’s go!!✌️🛡️
MARKET REVIEW
We finally found the support I was looking at around the 11689/11794$ area following 2 bad news that was not able to keep the market down below these levels and the UTL.
If it was only for this bounce, I would not be that excited, but for 2 weeks now we are seeing extreme bearish sentiment, leading stocks breaking out of sound bases and big sectors showing constructive price action. I will play this bounce on defense as the others as we are still below the 50dma and the market as everything to prove yet, but things look really interesting.
Now we’ll get into the crunchy part indices-wise. We get into the declining 50dma really fast and also we have to go through the past 2 structure swing high at 12168 & 12262$. These should also coincide with one another.
I will still define my Bullish & Bearish scenario, but I will not be as aggressive to switch from the market long to short as we are now seeing leading individual names decoupling from the indices. The play from now will be to concentrate on the TML (True Market Leaders) and widen a bit my B/B scenarios a bit to give more leeway to my positions.
Bullish scenario:
IF:
CLOSE above 50dma & 12168/12262$ resistance area
THEN:
Add long exposure with respect to Progressive Exposure & Market based Exposure
Bearish scenario:
IF:
CLOSE below 11689$
CLOSE below UTL
THEN:
Close long if red flags and SL hit
MARKET BREADTH
We had 1M NNH (yeah! :)) & 52W NNL Friday. We also saw a big push on both the Net adv/decl & the stocks above their 50 & 200dma.
MMFI (Stocks > 50dma) - We are still in that consolidation area that I talked about all last week, but we might breakout of both this consolidation area and the DTL from March really top. Tomorrow will be interesting to see if we confirm the breadth breakout here.
VIX - followed through on Thursday's action and broke both the UTL from March and even the recent 24.33$ swing low pivot. Things are looking good and that’s exactly what I wanted to see for a potential rally. Now we want to see it drift down.
USD/CAD - For now, false breakout! This is really positive as this was my only big red flag last Thursday while I was doing the Newsletter.
HYG/IEI - We also confirmed the H&S pattern here on the credit spread. This is a clear positive sign here as well and we now want to see it drift down slowly just like VIX.
ECONOMIC CALENDAR
Now a big week on the economic news.
SECTORS PERFORMANCE
Of our 3 leading stocks, 2 still…lead, for Solar, it’s another story. SMH really confirmed its strength last week and is now leading the market.
(SMH) Semis - We broke out of that 21dma and now going for the 50dma & resistance area above. This will be a very good test and we will see if we roll over or are able to breakout from it. A few days’ consolidations right below it would also be very constructive.
(TAN) Solar This one is lagging and I don’t like the big swings solar stocks make recently. We will want to see more price tightness before being interested in solar name again.
(XBI) Biotech We are building a beautiful BO10PB & BORS set up at the recent stage 1 base breakout area. This is very constructive action after the recent run-up we had from the lows. I am looking for a continuation move.
LEADERS LIST
Overall leaders (PRIME Score)
CELH,SWAV,DVAX,DQ,QURE,ACET,STKL,CEIX,HRMY,SIGA,OPCH,LNTH,LI,SRPT,JKS,EXEL,ARLP,AGEN,BNTX,HIMS,
Fundamental leaders (FA Score)
MRO,AMR,HDSN,ARCH,SQM,OXY,LTHM,PLYA,METC,HCC,EPR,CPG,PXD,MXL,HST,HP,CF,SHO,OPEN,MAR,
Technical leaders (TA Score)
TH,CELH,ACET,CEIX,QURE,SIGA,SWAV,DVAX,STKL,OPCH,AGEN,ARLP,SRPT,LNTH,HRMY,GRBK,JKS,VCYT,HIMS,BEAM,
Relative Strength 1 Month (1M-RS)
TH,AGEN,IS,SRRK,QURE,BEAM,VCYT,ACET,CELH,ARWR,AFRM,DVAX,GRBK,TSP,FLYW,SWAV,CDMO,RCUS,TDOC,CFLT,
Relative Strength 3 Month (3M-RS)
SIGA,TH,STKL,CELH,DQ,LI,DVAX,HRB,YMM,PDD,QURE,AHCO,BEAM,VTNR,GRBK,AGEN,PAYO,BKSY,VIR,ELF,
Relative Strength 6 Month (6M-RS)
TH,SIGA,LNTH,CEIX,VTNR,HDSN,STKL,CELH,HRB,DQ,AMR,PRCT,AR,OXY,EQT,ARLP,HRMY,SQM,GLNG,HALO,
PT PORTFOLIO UPDATE
Alex’s FOCUSLIST
HRMY
HRMY is a biotech leading stock with impressive action in the last few weeks. It is consolidating very constructively above the breakout level and retested it again today. I like how we got support and closed almost unchanged on this weak market day.
Watch for a retake of the 55.14$ pivot (see on 65min timeframe as the first breakout thrust high) for a continuation entry.
UPDATE: Been 4 days in a row that we are supported at the 10dma and with higher lows each day. This is very constructive action at the area retest.
Alert - 55.14$
GTLB
A software name that a follow and traded for a while is just being supported at every level down and is not really breaking down. I like how we’ve been supported at the 21dma for the 3rd day in a row…RIGHT at the breakout support area. I will watch for the channel DTL breakout or recent swing high pivot for an entry.
UPDATE: I now have a position in this name as I entered Friday on the DTL breakout, but the entry pivot is still active.
Alert - 56.60$
LI
Yeah…a Chinese stock :)
This one is simply setting up too good to pass over. This is also a larger market cap stock, so the risk is a bit less IMO. I will not trade a full position on it, but a 1/2 position is acceptable. I see a perfect BORL & BO21PB setup as we are retesting the breakout area. We were able to hold the 21dma 2 days in a row and are now above the support area. Also notice that we were able to hold the lows from the first area retest, this is constructive.
UPDATE: We are still building nicely that right side within the wedge and we now have made a higher low and looking for that DTL breakout tomorrow. Both the DTL & entry pivot are on watch for me.
Alert - DTL + 39.5$
STKL
Very powerful name that I missed the entry of the initial breakout. The initial 65% run in 3 days on the last ER is pretty impressive along with the nice VCP base it built afterward. We broke out on power last week and we are now building a nice consolidation at the 10dma.
UPDATE: supported again at the 10dma and UTL with a higher low. Setup is still valid.
Alert - 9.11$
DVAX
One of the strongest biotech names of the past few weeks is now setting up for a classic BO10PB after its recent base breakout. When you miss the initial breakout, that’s the kind of good R/R entry I am looking for an entry. I will watch either the DTL or the recent 14.88$ recent swing high pivot for an entry.
UPDATE: higher low at the 10dma again. We had our DTL trig Friday, so I will look at the 14.88$ pivot to position on this one.
Alert - 14.88$
ACET
A biotech name that recently had an incredible 70%+ run from the lows and never gave an entry. We now are completing my BO10PB setup on that first 10dma retest after the breakout. I like these lower-risk entries on such leading names.
Alert - 18.64$
HALO
Another interesting biotech name that we had in this FL for a while but is now setting up again with this base breakout level retest. We are creating my BORS setup right now and I will be looking at 50.40$ recent swing high pivot first for an entry. We might need couple of days of consolidation at these levels or we can simply shoot higher as we did 2w ago.
Alert - 50.40$
CAL
A name that I am following for a while but is consolidating forever at the breakout area. We found good support at the 50dma Friday . I will look to use the 27.17$ pivot for an entry, which is the second breakout swing high in this base.
UPDATE: still building that tight consolidation at the 50dma & right below the DTL & entry pivot. We’ll breakout one way or another…
Alert - 27.17$
UTHR
Another name that I follow for a while which simply refuses to break on each market low is UTHR. I like how we keep holding the 10 & now the 21dma right at the breakout level. We broke from this mini channel Friday and we are looking strong right below the last swing high pivot which I will look to initiate a position.
Alert - 242.52$
REFERENCES
Articles on my system:
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instead of being charged monthly I paid $240 for a full year when the rate is only $220?
*m confused cause I was told it was cancelled after the 7 day trial and now it looks like it's paused until Jan 2023...