Thursday January 25th – Is Everything Ok?
This is the DATA that often moves our markets one way or another.
.
SPX – I do see a reversal candle, but we also had one 2 days ago that didn’t amount to much. If we do get a dip from the data, it should be short-lived. Notice the green 8 ema and how it has nicely provided support on the way higher in the past. Price also could back test that wedge breakout and we have RSI divergence, but we really just have to wait and see how it plays out, since it is only day 12 of a possible 40+
.
NASDAQ – I wanted to point out that the NASDAQ found support at the 34 sma, and it is also 12 days out of the dcl. So this shows me that the General Markets are healthy and look great, however…
.
MY THEME TODAY WAS: “IS EVERYTHING OK?”
.
I have been noticing that many of the small caps that I watch are not responding as well as the Tech Stocks and Semiconductors, and that can be seen with the IWM. Notice also that The IWM is only 5 days out of the lows, after it actually lost the 34sma. So this is weaker than the SPX & NASDAQ.
.
I WANT TO PUT OUT A SMALL WARNING OR CAUTIONARY NOTE: I watch & trade certain stocks that are familiar to me from past trading. Some are now showing more weakness than they should early in the 2nd daily cycle. Stocks like AMZN, GOOG, NVDA, etc are fine. They remain Bullish, but I also liked to trade SQ, CVNA, PAGS, TWLO, FUBO, GRPN, SNAP and others, and for some reason they are showing a little more weakness. I will post 2 charts for you to see.
.
SQ was VERY strong in the run out of the ICL, but it is now a bit pathetic. Look at the MACD & RSI. This is concerning.
.
CVNA: I have always done well with CVNA, and it often had 10-12% up days. The recent run from $30 to $60 was fast, so I bought at the 50sma support. Yesterdays selling looked concerning with the markets back at new highs and the MACD & RSI failing here.
.
Take a look at the others I mentioned above and look for these clues( TWLO, FUBO, GRPN, etc)—These, along with the IWM, may be signaling something bigger around the corner. Again, it isn’t a big deal yet, and NVDA, AMD, MU, NVDA, etc look great, but some of these others? Behind the beauty cracks appear. I’ll keep an eye on things as they either deteriorate further or repair.
.
WTIC – Oils slow chop higher continues as it reached day 27 of what is often a 45-50+ Daily Cycle.
THE XOP, which represents the GUSH trade or individual Oil Companies, is also starting to make slow progress higher. That is good news, but one bad thing about this slow chop higher is that 1 bad day could take all of this back. A nice strong push to the 50sma would be helpful.
The USD is on day 19 with a day 17 peak. It stalled yesterday and Gold, Silver, and the Miners shot higher, HOWEVER, then things seem to have become odd…
As you can see, GOLD Popped and then sold off. Why do I think that this was odd? Because…
SILVER, which has been very weak, shot up by 2% and held much of the gains. This actually looks like a bullish descending wedge and the volume was good.
1. So Gold has been strong, but it sold off,
2. Silver has been weak, it held onto the gains.
3. What did Miners do?
.
GDX had a very big gap open and then sold off. That really just gives us a strange mixed set up and we’ll have to see how it plays out, but I am not trading it, since we should be in a 3rd daily cycle or 4th, and they become weak quickly.
,
We’ll see what happens to the futures at 8:30 a.m. ET with the Data release, right now I see futures Up. Enjoy your Thursday trading!
.
~ALEX
.
BITCOIN – So far we have seen a series of small bounces and then a drop after the 3 day bounce. If you are familiar with how quickly and sharply Bitcoin can fall, then this is good news. It allows Bitcoin to ‘waste some time’ as it drops lower. 30 – 60 days lower can be brutal when Bitcoin is in a bear market. This has been a nice controlled drop so far. It should pick up right before the DCL/ICL, so hopefully it puts in a nice bounce before then too.
