PrimeTrading daily Update & Focuslist - 04/25 (WEEKLY EDITION)
Market in correction - ugly action
This week edition is done earlier, as tonight I’ll be in Montreal to assist a classic Bruins-Canadiens 🏒 game :) GO HABS GO !
Overall, I’m still waiting for this market to flush, heal and show strength before stepping back with some long exposure. The next few days/weeks, the daily update will probably be more of a general market update with few if nothing in the FocusList. I’ll be looking for RS and will probably be talking about the stocks that hold the best though.
Enjoy ! ✌️
Disclaimer: This newsletter is not financial or investing advice. The information is for education purposes only and reflects only my own operation.
Market REVIEW
This week was really ugly tbh. We opened right under 10wma, only to find support and attempt the channel breakout on the upside. This was looking good until we test the 30wma and rejected it TO THE TICK. This also created a very nasty failed retest / lower high from last month 4581$ rejection.
We had 2 days of really nasty action Thursday & Friday to reject both the 30 & 10wma on volume to close the week at the lows below 4277$ level.
With this kind of sustained and high volume selling to close the week, I would be very surprised if we don’t test the 4138/4220$ area next week.
Breadth:
VIX spiking above 28 - Volatility is expected in next few sessions.
McClellan still negative but don’t seems to drop, so much more room on the downside.
Both new 52w net H & Adv/Decl with big red days.
Also, notice how put/call ratio just starting to increase but still have a lot of room historically. A real bottom normally needs readings above 1.0 as a contrarian indicator. Stocks above 50 & 200dma continue to decline constantly and now both below 40%. Watch numbers below 20%, in the 10’s for a potential bottom.
Overall, extremally poor breadth confirming the downtrend resumption.
Sectors:
This is where things really gets ugly and troubles me. Metals, Oil, Energy, Miners, Solar, etc. have been the clear leaders of the recent rally. They were not only the strongest, they were literally holding the market. Now this week we’ve seen total destruction in those areas that were leading. They all got destroyed and cut right through important kma’s on volume. When the leaders are breaking down, take cover…
Also, I don’t like to see very defensive sectors leading this week such as Staples. This sectors includes all basic essentials products that we normally still buy in recession or hard times compared to consumers discretionary & other sectors.
We’ll have too see if next week trend continue and confirm the clear change of character.
Portfolio UPDATE
No change in the portfolio Friday. I still hold my Russel 2K short through the SRTY 3x inverse ETF.
Now sitting on a 13% cushion on the position, I plan to trail the 5dma for a full exit, and might take partials along the way.
New positions:
Trimmed positions:
Closed positions:
Daily FOCUSLIST
No names will be on FocusList Monday. Market is clearly hostile and don’t want to be trapped in false move as they might occur during a market potential leg down.
Relative Strength TRACKING
I’ll start tracking top fundamental stocks with highest 6 months Relative Strength, holding up the best short term. (10% 1M-RS + 90% 6M-RS ratio).
During market correction, you want to keep track of these names as they will be the one to watch when conditions improves.
Relative Strength - TOP 20:
EQT NEX CAR CRK PBF ATI RES GOGL AR BTU NUE SLCA SD CEIX SWN TMST OXY TALO STLD GNK
REFERENCES
Articles on my system:
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where could i track Relative Strength of stocks?