Erasing the Pullback One Day at a Time
The key levels are really standing out right now.
Technical Edge —
NYSE Breadth: 70.1% Upside Volume
NASDAQ Breadth: 80% Upside Volume (!)
The Nasdaq has generated its third day of 80%+ upside volume in the last five sessions (and fourth in the last ten). Further, the Nasdaq has generated upside volume of at least 77% in five of the last six sessions.
It’s been an impressive stretch for tech, but damn, it should be. This group became so oversold it was ridiculous.
Game Plan
It has been a solid run for the bulls lately and a needed rally at that. Given the situation though, it’s still tough to sort out whether this is a change in tune for the market or simply a really strong dead-cat bounce.
I don’t necessarily lean one way or the other at the moment. I will say, stronger breadth would have me feeling better about the bounce. That said, I also believe we’ll have a better buying opportunity in the future.
What I’m really saying is: I think we’ll get a better opportunity on the long side, but don’t want to fight the trend.
As it pertains to more upside, see the below chart.
S&P 500 — SPY
Feel free to extrapolate the below levels to the ES
Now pressing through the 200-day, Monday’s high and last week’s high, the SPY has a pretty clear objective: Hold those levels on the downside and fish for $453.50 on the upside.
The latter is the 61.8% retracement for the entire correction. Above that puts $458 on the table. Below the 200-day and $441 could be back in play — the prior March high.
Nasdaq, Gold, etc.
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Go-To Watch List
Go-To Watch List
*Feel free to build your own trades off these relative strength leaders*
Numbered are the ones I’m watching most closely. Please look at these closely, as there are several updates from trades triggered from the newsletter!!
NKE — Perfect fade from the post-EPS rally…[premium only]
PANW — Definitely trimming ⅓ to ½ here at ATHs...[premium only]
BRK.B — Hit $342 trim spot. Trimmed another ⅓ at $350...[premium only]
VRTX — Trimmed ⅓ at/near $250....[premium only]
F — 2x weekly up rotation is triggered (from video)....[premium only]
Economic Outlook
