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.
It’s been two days of straight up, for the Nasdaq.
Tomorrow could make it a third but is that ‘normal’ market behavior, given the chart at left?
After breaking through one level of resistance and then, hitting another, the more probable action is to retrace and test the lower support (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.
If the Nasdaq, QQQ manages to breakout higher from its wedge pattern, the rally may last into August; the top of the market in 1987 (not advice, not a recommendation).
Such a rally would need to start soon, if the pattern is in-effect.
Otherwise, we may see it morph into something else or fail, with a decline from here.
Nasdaq QQQ, Daily
Note how Force Index (zoom area) has oscillated itself into an inflection point.
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.
Unfortunately, the (mad scientist) graphic at left, is not too far removed from what’s really going on in biotech.
While the S&P, Nasdaq Qs, Gold Miners, Semiconductors, Financials, The HOOD, ORCL, and others, continue to make all-time highs, conspicuously absent is biotech, XBI and IBB.
Now, it appears that quietly, in the background, XBI is reversing to the downside.
Biotech XBI, Daily Close
The up-thrust is there, but is a weak penetration of resistance.
Even so, on the ‘test’, volume contracted by -49.24%, when compared to volume on the upside penetration.
Until proven otherwise, this set-up appears to (currently) be the best short opportunity.
With that said, all other short positions have been closed to focus on biotech.
Leveraged inverse fund LABD is being used at this juncture: Trade LABD-25-10, with stop at the session low (not advice, not a reocmmendiaton).
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.
The Russell 2000 has been recovering (along with the rest of the major indices) from the lows posted on April 7th, and 9th, this year.
What the index has not done, unlike the Qs, and the S&P is post new-all-time highs.
At this juncture, tracking fund IWM, is at a Fibonacci 61.8%, retrace, and giving just a hint, it might be finished with further upside.
Russell 2000 ETF, IWM, Daily
As the chart notes, we’re in up-thrust ‘position’; meaning, there’s no new daily low to help confirm a potential reversal.
As presented many times in previous posts:
‘In the markets, you’re either early, or late’.
Upside risk (on a short) is set at last Friday’s IWM high; risk is low (but not zero).
With that said, a short position was opened (after-hours session, yesterday) in the IWM, via leveraged inverse fund TZA, trade TZA-25-03 (not advice, not a recommendation).
Note: There was no ‘new daily low’ in the IWM tracking fund to ‘confirm’.
However, in the pre-market, IWM is trading lower at 214.72, and threating to post a new daily low at 214.13.
Open Positions
At this juncture, 8:50 a.m., EST, open positions are as follows (not advice, not a recommendation).
Short Wal-Mart: WMT-25-03, Stop @ 98.16
Short Tractor Supply Co.: TSCO-25-01, Stop @ 52.93
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 Good: Only the Senior Miners, GDX, have managed to claw their way past the highs set nearly five years ago in August of 2020.
The Bad: Junior Miners GDXJ, remain below that August ’20, level.
The Ugly: Silver Miners SILJ, are the worst, having their peak a bit later in February of 2021; they remain over -35%, below their highs.
The Market Rolls Over
Yesterday, Friday, was a down day for the Dow, S&P, The Qs, Transports, Airlines, Semis, nearly everyone.
For some of these indices, their all-time highs were posted months, if not years ago.
There may be some (bidding) ‘defensive’ action with gold (GLD) continuing higher; as said in earlier posts, the rest of the monetary metals are far below their highs.
Let’s look at the weakest; the silver miners, as they are likely going to be the ones most affected by an economic decline (not advice, not a recommendation).
Silver Miners, SILJ, Daily
We’re at an interesting spot.
Friday was a down day that pushed below existing support, shown in zoom area.
We have simultaneous action.
Once resistance was penetrated on March 18th, it could not hold. After eight trading days, on Friday, it posted lower on heavy volume.
However, we can see that SILJ, is now in (a minor) Wyckoff ‘spring’ position. So, the question is, what happens next?
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.
That is, finishing its initial downward thrust, then a retrace to test the wide bar(s), high volume.
Carvana CVNA, Daily
On a percentage basis, CVNA has weaker action (which may not be finished) than NVDA.
The ‘Short’ Side
If the market begins a persistent decline, will the SEC ban short selling as it did in 2008, link here.
It’s important to note, immediately after that announcement, the market absolutely cratered on massive volatility; the Qs dropped over -41%, from that point.
This time around (if it happens), with a new Sheriff, will there be a short-selling ban?
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.
The Danger Point® 