A ‘reverse trendline’ is a technique (described by Weis in 2007), where the left-most trend is plotted first, then copied and moved to the right to contact price action.
That was done for XLF.
One might think the channel was drawn just before this post.
In actuality, trendlines were drawn about eight trading days ago.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
When you add it all up, if the SOXX was going to reverse from all-time highs into a sustained correction, Friday’s close would be a good place to start (not advice, not a recommendation).
Prior updates have been consistent with the (Wyckoff) premise, upward thrusts are covering less net distance.
SOXX Hourly Details
First, the markets are fractal.
We see the same repeating pattern of ‘spring to up-thrust’, on the hourly as on longer timeframes.
Second, tops and bottoms are different.
The characteristic of the ‘spring’ bottom and the ‘up-thrust’ top are how markets behave.
Bottoms, ruled by fear, typically sharp and well defined.
Tops, ruled by hope, typically wide and rounded.
Semiconductors SOXX, Hourly
The top shown above, is what David Weis used to call, The Danger Point®, where risk (cost) of being wrong (on a short, in this case), is least.
In his video, he points out this type of action, saying ‘the market could just keep on going … so what’.
His meaning was, it’s the point where there’s instability, therefore, potential for reversal (not advice, not a recommendation).
For those who don’t have that video, it is timeless wisdom, still available here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
With a short-entry signal that’s straight out of David Weis’ training video (recorded in 2007), Alcoa breaks down in dramatic fashion (not advice, not a recommendation).
As of this post, 11:34 a.m., EST, Alcoa has gap-opened lower, currently down, -5.10%.
Alcoa AA, Daily
Prior short, AA-26-03, was exited last Friday with profit.
That action proved to be correct. The next session (yesterday), was a rally into a test.
Today, was a gap-lower open.
There’s a potential for a sustained move. Short, AA-26-04, opened with a stop located at yesterday’s high (not advice, not a recommendation).
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Who knows what type of ‘weather’ we’ll have this time.
So, nat-gas can’t go any lower than where it is now, right?
Wrong
That type of thinking’s called a ‘Mind Trap’, link here.
David Weis would typically start mentoring sessions with a question (after presenting a chart):
“What do you see?”
Forgetting all the factors that ‘should’ drive the price of nat-gas higher, we have the chart.
Natural Gas ETF, UNG: Daily
The upper blue line is resistance which price action ‘up-thrusted’ (reversed).
The green line is a minor support area.
This is where a long position was initiated (UNG-25-01). The expectation for the next day (last Friday), was for an immediate increase it price.
That didn’t happen. The long position, the only ‘long’ for this year, was exited (not advice, not a recommendation).
The orange line is another support area but the lower blue line, if UNG gets there, is the ‘spring’ set-up target.
U.S & China Nat-Gas
Last Friday’s chaos with China and tariffs, begs the question if Chinese nat-gas shipments would be used as a tit-for-tat pawn; meaning, China halts all purchases.
The short answer is no.
For all of 2025, there’ve been no shipments, link here.
With that said, if nat-gas is going to move lower to the target area shown, then something else would be the driving mechanism.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Gold, silver, and the S&P are essentially unchanged (as of 6:44 p.m., EST).
Although it appears to be a quiet weekend, we should at least take note of the terminating wedge pattern in the S&P.
The S&P is probably the most computer controlled, most manipulated, most algorithmed (if that’s a word) market in the world.
From a personal standpoint, I do not trade it and have not for over 15-years.
There are better ways to engage and not volunteer oneself to get whacked every day by a mass of computer algorithms (not advice, not a recommendation).
With that said, we’ll look at it anyway. 🙂
S&P 500, SPY, Daily (segment)
We’re oscillating into a wedge pattern. A wedge typically occurs at the end of a move, whether it be up or down.
With the Nvidia earnings release out of the way, the tone of the overall market may have changed.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
The last update on Financial Sector, XLF, said it was in potential up-thrust (false breakout) condition.
Monday’s action was slightly down and today; we have a new daily low.
In addition, as we’ll see in the chart, all of this action is taking place below established resistance.
Financial Sector XLF, Daily
We’re at the ‘edge of the lake’, as David Weis used to call it. This is where the risk of being wrong is least.
Since the market’s posted a new daily low, risk on a short position is well defined, i.e. yesterday’s high (not advice, not a recommendation).
Currently short this sector as XLF-25-06, with stop in the vicinity of XLF 53.58. After the close of this session, the stop (if not exceeded) will be moved lower to the high of today’s session (not advice, not a recommendation).
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
