Good evening folks,
We are getting to the crunchy part, can we push further…! let’s see that!
Let’s go!!✌️🛡️
MARKET REVIEW
And another strong day on the indices as we found good support at the 12454$ level pre-market and went straight into overhead resistance at 12578$ where we consolidated before closing strong right in that area.
We came under a bit of pressure post-market as SNAP earnings and a few others weighed on the market after hours. Let’s see where we open tomorrow.
I am still playing the rally but reduced my exposure a bit again EOD as we just had 2 legs up and begin to put our head into some pretty big resistance. I will wait for the first reaction (when? I don’t know) to see how the bulls step in to defend the rally and then I will increase my exposure aggressively.
Note that we also have a BIG week, next week. FOMC and major mega-cap companies report earnings. So I’ll make sure to stay light & nimble on my exposure.
Tuesday: MSFT, GOOG + GOOGL
Wednesday: META
Thursday: AAPL, AMZN
These 6 companies weigh more than 40,6% of the Nasdaq composition. So trust me when I say that next week will be DECISIVE for the market direction.
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. 🛡️
📈 scenario:
We are now in my bullish scenario until further red flags or consolidation
IF:
THEN:
📉 scenario:
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.
IF:
CLOSE below 12168$
CLOSE below 50dma
THEN:
Close TQQQ & defense
Alex’s digest:
Let’s look high level at the (+) & (-) of where we stand with today’s action
A lot of pivots breakout failed & squats today as well (-)
NQ is now right into the resistance area and a bit stretch short term (-)
XBI (biotech) leading sector tried to confirm BO10PB/BORS setup today but closed right at the pivot again (holding tight) (+)
Market breadth is still improving (NNH,>50dma, etc) (+)
Speculative money found supply but held important levels (Crypto) (+)
USD & VIX are drifting down (+)
2Y & 10Y bond yield crashed both today and look like selling pressure can continue (+)
OK amount of setups tonight (=)
Crude oil (CL_F) sold off today and back into support (+)
Mixed bag tonight. The market could come into pressure, but I’ll play this rally until (-) really overwhelmed this section.
MARKET BREADTH
Breath continued to improve today with yet another 1000+ NET A/D and another day with 1000+ Net 1M new highs.
MMFI (Stocks > 50dma) - breakout continue with another smaller push today but we are still above 5dma. meaning the trend is strong.
VIX - We retested the 24.33$ level and rejected it once again. This is good as this is the second rejection in 2 days and we closed on the lows down more than 3%+.
USD/CAD - No real buying at the 50dma today and even rejected by the 10/21dma today, we stay in the support area for now.
HYG/IEI - Continued lower in the support area and we got a spike in volume today. Let’s see if we can continue down or find some more support here.
10Y BOND YIELD - This is a big change of character on the 10Y yield as we tried to breakout from our wedge in the past few days only to get hammered down right below DTL, UTL & recent potential support area. This look like a bear flag to me. I would expect we go test at least the 2.5/2.7% area.
ECONOMIC CALENDAR
SECTORS PERFORMANCE
The same 3 leading sectors are on the radar for me, SMH, TAN & XBI. There is also another sector that starts leading recently and that I’ll start to cover, ITB (home builders).
(SMH) Semis - Rocket higher past the support area and from the 50dma breakout. I am really looking forward to this sector pulling back and consolidating to give me an opportunity to get involved with a SOXL exposure trade. Note that with today’s close, we just completed a near-perfect measured move from the first leg up. This can mean that we are near some ST top & a potential PB.
(TAN) Solar Wedge breakout and retest of the DTL today. Still acting good, but note that these names have ER very soon. ENPH next Tuesday.
(XBI) Biotech - Tried to breakout from that breakout top pivot but closed right on it as we saw some squatting today. Setup is still very well valid and I am now playing this leading sector with a position in LABU (3x ETF). Let’s see if tomorrow we can reclaim that pivot and push for the breakout.
(ITB) Home builders - I will have to do some digging in this sector to find the leading stocks, stay tuned for the Sunday edition for that.
LEADERS LIST
Overall leaders (PRIME Score)
PRCT,CELH,QURE,AMR,INSW,CNK,HIMS,EQT,VET,HDSN,TH,ON,PLAB,AR,RRC,CHPT,TELL,SBLK,BEAM,CAN,
Fundamental leaders (FA Score)
MRO,AMR,HDSN,ARCH,SQM,NFE,OXY,LTHM,PLYA,METC,HCC,PXD,CAN,MXL,GSL,HST,HUT,HP,CF,SHO,
Technical leaders (TA Score)
TH,PRCT,QURE,HIMS,CELH,CNK,TELL,INSW,BEAM,EQT,PLAB,NUE,VET,RGEN,LSCC,AR,CPNG,RRC,ELF,ON,
Relative Strength 1 Month (1M-RS)
IS,SI,RIOT,TH,AFRM,BEAM,HUT,BFLY,CPNG,TSP,AHT,CNK,FTCH,SRRK,AVYA,CAN,AMRS,HIMS,RGEN,LSCC,
Relative Strength 3 Month (3M-RS)
SIGA,TH,YMM,STKL,LI,BEAM,CELH,PDD,DVAX,DQ,QURE,BKSY,AHCO,CD,ELF,PLAB,ENPH,VIR,RGEN,AGEN,
Relative Strength 6 Month (6M-RS)
TH,LNTH,CEIX,VTNR,SIGA,HDSN,AMR,PRCT,AR,NFE,EQT,CELH,STKL,OXY,HRB,ENPH,CRK,SQM,SD,GLNG,
PT PORTFOLIO UPDATE
Alex’s FOCUSLIST
STKL
I really love the big push this one had following the last ER and based for a few weeks which we breakout 2w ago on good volume. We are now consolidating and creating a nice BO10PB setup which we tried to confirm but came back in. I will use the recent swing high to confirm the pattern completion.
UPDATE: Still getting squeezed at the 10dma.
Alert - 9.41$
SWAV 🎖️
A name that I traded a bit next week on the breakout, but closed it when we squatted back to the pivot. I am now looking again at this name as this has found good support at the 10dma and recent breakout level today and closed strong with a DTL breakout. I also notice that this is leading XBI sector today, so good RS that I take note.
Alert - 214.44$
SIGA
A more speculative name that had a big climatic move a few months ago just consolidated in a very nice VCP pattern above the 21dma and made higher lows in the entire base. This one has been on my top RS list for a while and I think right now we are ready to push higher if taking off the 15$ recent WB breakout high. Look how we are getting squeezed volume really dried up in recent days.
Alert - 15.00$
CEIX
I am looking closely at the Coal sector as the commodity is setting up for one hell of a potential breakout IMO.
I am looking at CEIX which shows more liquidity & RS than ARLP lately. I am now seeing a retest of the DTL, to create my WBPB technical setup. I will be looking at WB breakout candle high for a confirmation of the setup and an entry.
UPDATE: Gapped down and found good selling pressure but we found support at both the DTL and the 21dma, keeping the WBPB valid. If the commodity can perk up a bit, this one can run imo.
Alert - 56.79$ + 58.39$
LABU 🎖️
As explained in the sector section, the biotech sector is 1 of the 2 leading sectors right now for me. XBI is setting up with a perfect BO10PB technical setup at an important level, so I want to get involved and get exposure in this sector going forward by opening a long position in the 3X ETF LABU. I will be looking at the recent swing high 9.69$ or the DTL for an entry
UPDATE: consolidating with yet another tight day right above DTL and below the entry pivot. Still waiting for my pitch on this one…my play is getting XBI exposure in the top 2 leading sectors right now.
Alert - 9.69$ + 10.20$
GTLB
We are building that mini consolidation nicely and I like how we reacted to yesterday’s squat. We held the previous pivot and closed above the 10dma & AT the DTL.
Still acting like a leading stock IMO and will look to get back if we reclaim that 59.90$ pivot.
Alert - 59.90$
DVAX
Missed the entry yesterday, but I like how we retested the 14.88$ previous entry pivot and held it by closing at the highs. I’ll play the BORS setup if we reclaim b/o candle high at 15.50$.
Alert - 15.50$
🎖️ = Alex’s high conviction setups
REFERENCES
Articles on my system:
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