Good evening folks,
That was a pretty uneventful day, but buckle up because tomorrow should be something else with a big economic release lineup!
Let’s go!!✌️🛡️
MARKET REVIEW
And just like that, we’re back below all kma’s!
As expected, today gave not much information as we stayed above the 11689/11794$ support area and below the channel DTL.
Tomorrow we will have very expected inflation data at 8:30 and we really see that the market is waiting on this data to take a side and a direction. So for now, we will prepare our bullish and bearish scenarios for tomorrow in order to be ready for either outcome.
We are still in a downtrend, playing a reaction rally, so keep in mind that this market can roll over any time even if we see some strong groups and individual names. We are still on thin ice! 🛡️
Bullish scenario:
IF:
Reclaim wedge DTL
Reclaim 11974$ pivot
A close above today’s high (12025$) would be ideal
THEN:
Add long exposure with respect to Progressive Exposure & Market based Exposure
Bearish scenario:
IF:
Break below 11689$
Break below UTL
THEN:
Add short exposure through SQQQ
MARKET BREADTH
We had 1M NNH on NDX but NOT on NYSE AGAIN today. I don’t like to see negative A/D AGAIN TODAY… This was a signal last week with those negative A/D while the market was climbing on low volume. On the positive side, stocks above 50dma & 200dma is holding up pretty well and consolidating at these levels for a few days now.
VIX Big gap up today above the 26.83$ recent pivot and is now sitting right at the DTL from recent consolidation. It’s no surprise that we are waiting here… If CPI print is bad tomorrow, it’s a straight breakout of the wedge, and if CPI is good then we reject it and go lower for here. PIVOTAL POINT
USD/CAD We are now squeezing against the base top resistance level and this last month's price action has clear VCP characteristics. IF we break that level, it won’t be good for the US stock market.
I’m not calling or implying anything bad WILL happen… but the 2008 USD/CAD base-on-base setup reminds me a lot of what we see right now. Just to keep in mind.
ECONOMIC CALENDAR
SECTORS PERFORMANCE
1 sector is clearly leading for my right now, Biotech & Healthcare. And that’s where I want to focus right now.
One that is leading for the past week or so and that I will be watching more for setup in the coming days & weeks if we confirm it, is Semiconductors. (SMH) We are seeing nice action, but we are still below all kma’s and in a downtrend.
(SMH) Semis We held the support area I highlighted last night. We have not lost it all..!
UPDATED: Held the support area once again, tomorrow is pivotal here also.
(TAN) Solar Not looking good for the past leading solar sector. I begin to see it less & less as a potential leading sector, especially with the last 2 days’ action. We can still find support at the wedge UTL & come right back to test the resistance level above…but I don’t like that solar names sold off and did not show RS in a not-so-bad general market…
(XBI) Biotech Leading, leading, leading. This is by far the best acting sector as we are just retesting the stage 1 base breakout and found great support at the 10dma and managed to even close above the area. Underneath is mostly what catches my eyes with a lot of ind. names acting really good, showing RS, building consolidation above kma’s, etc. That’s where my focus is right now.
LEADERS LIST
Overall leaders (PRIME Score)
LI,HRMY,AMN,CEIX,AMPH,DVAX,SIGA,CELH,STKL,DQ,JKS,QURE,CALM,EXEL,ACET,LNTH,ABCL,HRB,ELF,SRPT,
Fundamental leaders (FA Score)
MRO,AMR,ARCH,SQM,OXY,LTHM,PLYA,METC,HCC,CPG,PXD,MXL,HST,HP,CVI,CF,SHO,OPEN,MAR,CVE,
Technical leaders (TA Score)
SIGA,CEIX,LI,QURE,HRMY,STKL,AMPH,CALM,ACET,ABCL,DVAX,JKS,CELH,AMN,HIMS,HALO,ELF,SRPT,LNTH,EXEL,
Relative Strength 1 Month (1M-RS)
SRRK,AGEN,QURE,BEAM,VCYT,ZLAB,CDMO,ACET,HIMS,ABCL,VIR,ARWR,AMC,CFLT,FLYW,GTLB,ME,LI,PTGX,SNOW,
Relative Strength 6 Month (6M-RS)
LNTH,SIGA,VTNR,CEIX,DQ,HRB,OXY,STKL,JKS,PBF,CELH,CVI,EGY,HRMY,AMR,SQM,ARLP,AR,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.
Alert - 55.14$
ARLP
I am looking at ARLP for his strength, but also because I think Coal commodity chart is looking like a big VCP pattern ready to breakout hard. I see ARLP as a BORS setup with the 19.35$ entry pivot that I shared recently. We were also supported by the 5dma. I will be looking at yest’d high for a continuation confirmation & entry.
UPDATE: Still acting very good building pressure right below the pivot.
Alert - 20.24$
CAL
Retail name showing RS today in red tape. I like the way it is building a tight channel back to the 50dma after the initial breakout attempt (red resistance area). Notice how we are building higher lows structure right at the 50dma. It’s either that we break below and fail, or we reclaim the 27.17$ recent swing high pivot and make another breakout attempt.
Alert - 27.17$ + DTL
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 5dma.
This is a riskier entry because we are only pulling back to the 5dma, but sometimes the leaders don’t give any chance to enter if you wait for the 10 or 21dma. At least we have a level to manage risk and knowing the name can run much more than than before being extended.
Alert - 9.11$ (call the police, it’s a steal 🚔)
HALO
Another potential leader that we traded in the group but we got shaken out with the 50dma retest. The stock then never gave an entry before the base breakout. We are now looking at my loved and classic BORS setup, which is a retest of the breakout level. I love these because they offer a lower-risk entry, as the action leading to the setup completion is CONFIRMING that the breakout holds and we will likely see a trend resumption. I am looking at the 51.14$ breakout swing high pivot for a potential entry as the DTL is too steep on this one. I also like how we closed in the upper half of the candle today, showing this level was defended.
Alert - 51.14$
CELH
OK, CELH trade was frustrating for me today as I sold my runners on the 10dma break and the last 1/4 pos a little lower, but I did not wait for EOD to see if we would get support as we did. In the end, we closed above the 10dma. We’ll see tomorrow if this was a mistake or not. I am still thinking that this is the potential TML of the next cycle, so you will see this name quite often until I can get back in again. Right now, we see a BO10PB & BORS setup developing. I will watch for either the DTL breakout or the 78.34$ pivot breakout for continuation. Pivot is a little far from here, so the DTL might probably give a lower risk early entry for now.
Alert - 78.34$ + DTL
ABCL
This is one of my current position and it’s acting amazing out of the stage 1 base breakout. This is exactly the kind of action you want to see after a breakout, the stock being supporter on its first pullback of the 5 or 10dma in that case. If the market acts well and we get continuation confirmation here, I will probably add to my position on this name. We are looking at a classic BO10PB here with an early entry even being trigged today on the DTL breakout.
Alert - 11.60$
REFERENCES
Articles on my system:
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