Disclaimer: This newsletter is not financial or investing advice. The information is for education purposes only and reflects only my own operation.
What a FED day, it did not disappoint!
We were able to hold above yesterdayโs open all morning & early afternoon before FED. Then, following the interest rate announcement & J Poww speech, market really took off hard and b/o off very important recent levels.
4219$
4277$
5 & 10dma
Market closed more than 3% higher right under 21dma.
Tomorrow, weโll have to follow through on that strength to confirm the potential ST bottom & rally. First, weโll have to hold 4277$ and Iโd like to see close above his 21dma.
At this point, we have constructive action from key levels that justify getting exposure into this market, but itโs still a market below 50dma, so letโs take it day by day and use progressive exposure to finance our risk.
Breadth really confirms this move today. Stocks >50 moved more than 35% and we had >2000 advances total.
McClellan turned green @ 51.
The most important indicator here imo, VIX got CRUSHED and now back down to 25$ on a -13% move.
No important economic news tomorrow for the US markets.
Everything green (Except poor Transports) with Energy, Home builders, Oil, Semiโs standing out here.
If Semiโs can have a sustained move here this could be really good moving forward for the overall market. We also want to see broader participation, weโll have to see in the next few days.
Executed the plan I detailed yesterday regarding FED day. I closed almost all my positions before 14:00 except for PBF that was acting very good along Crude Oil futures.
I waited for the FED reaction to occur and opened back EQT & TNA positions. I also added a second TNA position and opened a new position in LNTH which I really love the recent RS & price action above his 10dma.
I might have some room on my progressive exposure limit tomorrow to open 1-2 new positions if market follow through.
New positions:
TNA (Add-on on FED power move)
LNTH (BORS setup on the 64.14 retest)
Trimmed positions:
Closed positions:
Iโll start tracking top fundamental stocks with highest 6 months Relative Strength, holding up the best short term. (40% 1M-RS + 60% 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:
AMR,CRK,CEIX,PBF,ARCH,LNTH,AR,ARLP,VLO,GOGL,SBLK,VAL,CTRA,CVE,SD,DK,EQT,CVI,MPC,REI
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Thanks for your work and sharing Alex.