Weekend Newsletter charts

    Posted by matt on 22nd of May 2021 at 01:17 pm

    I have most of my charts done, I may try recording tonight early. Otherwise have things to do today, if you want to glance over the charts here you go:


    here's my written commentary Otherwise here's

    Posted by matt on 23rd of May 2021 at 02:09 pm

    here's my written commentary

    Otherwise here's a index summary table

    - SPY System Breakout Trade Discussion- new hard stop is 408 for SPY, the system went long on April 5th and we already took 1/2 off the table weeks ago at higher prices thus lucking in a 25.8% gain on the SPY options.

    General Market Analysis

    Last week the market ended the week mixed with the Dow Jones, SPX, and Russell 2000 losing about -0.5% for the week, while the The Nasdaq big cap tech closed slight gains. The week started off weak with the market down Monday through Wednesday, where it recovered off the lows and rallied into Friday morning before closing off of Friday's highs. The SPX bounced right off that major support zone near the 50 day MA and the May 12th support low on Wednesday, however the resulting rally off those lows stalled right at the lower high from May 14th. The Nasdaq 100 also rallied off it's May 12th support low but stalled at its declining 20 day MA. The Russell 2000 is in a large coil formation, currently stalling out at its converged 20 and 50 day MA's. 

    After looking at all the charts I do not have a strong conviction for what the market is going to do here in the short- term, I could see it going either way. The 'bulls' defended the indexes last week as they all bounced off support levels, however the indexes stalled at resistance near their previous lower highs. The 'bulls' need to push the indexes over their May 14th lower highs to get this market on a course back to their recent highs or new highs.  

    I also see bonds important here as well. HYG has a potential abc low in place, if we can see a further follow through rally that takes out is previous lower high, that would be a strong positive for the market. TLT 20 year bonds also bounced off the lows - it would be a positive for the market if we see a continued bounce here, but a negative should this sell off.

    The bullish case for the market, using the SPX as the proxy, it completed an abc 4th wave pullback at Wednesday's lows and is in a wave 5 uptrend with wave 1 complete and currently in a wave 2 pullback. Wave 2's can retrace 38 - 50% of wave 1's, however much more than that and they become suspect so let's see how that acts early this week. The bearish case is that the SPX completed a wave b lower high last week and is going to sell off in a wave c. Price action will be our guide early this week. Remember we are in the weaker seasonality time of the year now. My guess for the intermediate trend is a choppy summer and possible a stronger correction in the early fall. 

    - Cryptos/Bitcoin- Wow this area got destroyed last week! We has a trifecta of bad information really that helped exacerbate this, however also technicals played out perfectly! Remember Steve and I showed Bitcoin as a very obvious wave B bear wedge a couple weeks ago and that pattern played out perfectly! So besides everyone blaming this selloff on Elon Musk, the Chinese etc, this impending sell off was already predicted well in advance by the chart!  Bitcoin lost 33% for the week, Bitcoin Cash lost 55%, Etherium lost 50% etc - these don't doesn't seem like stable currency replacements to me LOL. After such a washout this area needs time to heal technically and I expect a LOT of chop now. That said I am keeping an eye on some of the stocks like MARA, RIOT, SI, CAN that follow the cryptos as they may bottom before the crytos. 

    - US Dollar, Commodities, Precious Metals and GDX and a few individual names- The US Dollar fell 0.3% for week, however this didn't help most of the commodities. Remember the commodities have been in very strong uptrends for a while and are now having a logical pullback to consolidate those gargantuan gains they've had over the last few months. 

    For the US Dollar it fell again last week and has been very weak for quite a while, however there is some divergence building now to keep an eye on as a bounce may effect commodities and gold.  Gold and precious metals and stocks had a great week as Gold gained about 2%, while silver only gained 0.3%, and GDX the gold miners index (the stocks) gained 3.8%. We've now seen gold break over it's 9 month downtrend line and 200 day MA so longer term they look great. However this area could also pullback at any time, especially if the Dollar rallies. That said I would view a good pullback as a buying opportunity. 

    - Trade Ideas: I didn't add any trade ideas to this newsletter, I may add some to the Trading Community later today.

    Economic News:Next wee, FHFA Home Price Index, GDP, PMI, Initial Jobless Claims will be scrutinized. 

    Thanks! outstanding summation!

    Posted by profmel on 23rd of May 2021 at 02:16 pm

    Thanks! outstanding summation!


    Posted by steverobin on 22nd of May 2021 at 05:11 pm



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