Good evening folks,
Rough day in the market today, but most names holding up well. We enter into that packed phase of the week where we get important ER and FED statements that WILL move the market.
Let’s go!!✌️🛡️
MARKET REVIEW
Sliced through pretty important levels today with a break below the 12168/12262$ support area AND the 50dma as well. We are still in that mini channel and above the 21dma, but today’s action trigged my bearish scenario at the close.
Then came MSFT 0.00%↑ , GOOG 0.00%↑ & GOOGL 0.00%↑ earnings AMH, and the market reacted very well. We are now back above both the 12168/12262$ support area AND the 50dma on the futures. This is pretty positive that the market is reacting well to highly anticipated mega caps earnings that announced a hiring freeze in the last few days.
Tomorrow is the FOMC statement with the interest rate announcement @ 14:00, which WILL move the market, so I don’t give too much importance to tonight & morning action tbh.
REMINDER: We really have a BIG week, this week. FOMC (Fed interest rate) on Wednesday and major mega-cap companies report earnings. So I’ll make sure to stay light & nimble on my exposure and probably won’t carry a lot of exposure overnight.
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:
The recent swing high @ 12655$ will really be an important level to monitor in order to confirm a continuation of this rally by making a price structure new Higher High.
Also looking at the mini channel DTL for a very short-term potential reversal of these current levels.
THEN:
I will not take action on these scenarios this week due to major daily news
📉 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:
I will not take action on these scenarios this week due to major daily news
Alex’s digest:
Leading names are holding key levels (+)
NQ is under selling pressure, but manage to stay above support & 50dma (futures) (+)
Good futures reaction on OK earnings reports of GOOG 0.00%↑ & MSFT 0.00%↑ (+)
XBI (biotech) & SMH (Semi’s) finding support in the support area. Consolidation underway (=)
Market breadth is under pressure. (NNH,>50dma, etc) (-)
Speculative money under pressure (Bitcoin) (-)
USD & VIX spiked (-)
2Y & 10Y bond yield holding important levels (=)
Decent amount of setups tonight for a bad day (+)
Crude oil (CL_F) failed the DTL & support breakout (+)
MARKET BREADTH
MMFI (Stocks > 50dma) - Lost the 5dma, but still pullingback lightly, no red flag.
VIX - Gapped up and breakout of the 24.33$ level, 10dma & DTL today…which is not the best action. But we crash a bit EOD which is constructive overall. We’ll have to see tomorrow how we react to FOMC.
USD/CAD - Still in that support area
HYG/IEI (Credit Spread) - Credit spread popped out of the support area and right at the 50dma. On watch tomorrow.
BTCUSD (Bitcoin) - Held the UTL and lower channel DTL. We are still above the lower important support area, so until we break this one, everything is possible.
ECONOMIC CALENDAR
SECTORS PERFORMANCE
(SMH) Semis - Still trying to find support in that area. We closed right at the 50dma today and still in that mini channel.
(TAN) Solar ENPH reported killer #’s amh and TAN will probably open way up tomorrow. I will be looking at that WB setup and open a position on that 75.89$ pivot breakout
(XBI) Biotech - Still in that tight consolidation above the support level. 84.63$ is still the level I watch for continuation.
CL_F (Crude Oil) - Well, deception! We failed both the DTL & support level breakout today. I closed my GUSH position breakeven and will monitor closely if we can find support again tomorrow or following days.
LEADERS LIST
Overall leaders (PRIME Score)
SQM,LPG,ENPH,CEIX,SIGA,QURE,PLAB,NFE,VET,AR,CELH,OXY,LNTH,SWAV,TH,EVH,FLNG,AMR,PAYO,BEAM,
Fundamental leaders (FA Score)
MRO,AMR,HDSN,ARCH,SQM,NFE,OXY,PLYA,METC,HCC,CPG,PXD,CAN,MXL,GSL,LBRT,HST,HUT,CALM,HP,
Technical leaders (TA Score)
TH,SIGA,CEIX,IEA,ENPH,LPG,PLAB,AR,SQM,EQT,VET,QURE,BEAM,EVH,LNTH,PAYO,GRBK,FLNG,CELH,RRC,
Relative Strength 1 Month (1M-RS)
IS,TH,RIOT,IEA,SI,CYH,HUT,BEAM,SGRY,VET,CPNG,TELL,EQT,CNK,AMR,PAYO,AR,SIGA,ZLAB,INSW,
Relative Strength 3 Month (3M-RS)
SIGA,TH,YMM,STKL,BEAM,LI,PDD,AHCO,QURE,DVAX,CELH,DQ,PLAB,AGEN,HRB,RGEN,BKSY,CEIX,ENPH,CD,
Relative Strength 6 Month (6M-RS)
TH,CEIX,SIGA,VTNR,LNTH,EQT,AMR,HDSN,NFE,CRK,PRCT,AR,CELH,SQM,RRC,PBF,HRB,ENPH,STKL,SWN,
PT PORTFOLIO UPDATE
Due to the packed news release this week and being on vacation, I will not be very active this week as you’ll see. Might try a couple of momentum intraday swings, but nothing more than that.
Alex’s FOCUSLIST
HALO 🎖️
This biotech name shows RS over RS… Low how we bounced at that support area last week and we were not even able to break below the 10dma today and found good support (volume a bit low though). Recent swing high would confirm my BO10PB setup tomorrow.
UPDATE: Tried to breakout off last night's pivot and was not able to close above it due to market weight. I will set back the alert at the recent swing high 51.24$ instead.
Alert - 51.24$
SWAV
A health tech name that I follow for a while but was never able to breakout and follow through. I will be watching it again as it really refuses to break lower and hold the 10dma very well above that support area. 214.44$ first breakout swing high is the pivot I will monitor for continuation.
Alert - 214.44$
VET
One of the leading names in the Oil sector right now. We are building a nice tight consolidation right below the base top level. I like how we rejected the level Friday on very light volume only to rip right back higher today. Conviction comes from the commodity strength behind this play. 23.82$ base top level will be where my alert will be set for an entry.
UPDATE: Tried to breakout today but came back in due to Crude Oil weakness. If CL_F finds support and tries another breakout, I want to keep this VET closely in the FL.
Alert - 23.82$
PLAB
A semiconductor name that I follow for a while and waiting for a pullback to get in. The general market and SMH getting under pressure can a pullback at the 5dma. This is not the deepest pullback, but if SMH has a good day, this one might very well rip higher and never give a better entry. The recent swing high at 22.35$ would confirm the continuation.
UPDATE: another very tight day right above the 5dma.
Alert - 22.35$
CELH 🎖️
Leading name that I closed my position last Friday (mistake !!). We found good support today at the 80.35$ structure pivot and closed strong on a red day with an inside day. I will be interested to re-enter this name if we can close above 85.08$ as it would confirm my BORS setup.
UPDATE: Now double inside day and holding kma’s very well above the 80.35$ pivot.
Alert - 85.08$
SQM
A chemical name that I traded in the March rally, but is finding strength again after completing a larger WB setup and now looking for a potential low cheat base breakout with the 96.00$ pivot. Solid fundamentals.
Alert - 96.00$
🎖️ = Alex’s highest conviction setups
REFERENCES
Articles on my system:
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Hi Alex, question about the leveraged ETF. Do you look at the chart of the leveraged ETF? I have always heard that one should look at the chart of the unleveraged...
Cheers & have a nice vacation