When we see a sharp move down in equities, it is usually followed with some mean reversion. I have been saying in the last few market reviews I expect a second leg down. I was not expecting the move to happen this soon and to be honest, it is not complete until the pivot low is met.
| Symbol | Daily | Weekly | Monthly | Notes |
| SPX Score: Daily: -4 Weekly: – 2 Monthly: 2 | – Touched Bottom of Keltner and sliding along it – Momentum bearish – Rainbow EMA is bearish and price pulled back. – price < 200 (rejected again) | – Showing Squeeze w/ increasing bear momo – Momentum Bearish MACD + 10 SMA > 34 EMA but, hooking down – DMI bearish + price > 200 – Anti low pivot below w/ supporting price action | + 10 SMA angling up with price above it. Bullish + price > 200 | |
| NDX Score: Daily: – 5 Weekly: – 1 Monthly: 2 | similar to SPX | – Showing Squeeze, w/ increasing bearish momo – Momentum Bearish MACD + 10 SMA > 34 EMA but, hooking down – DMI bearish + price > 200 * Anti beginning to form | + 10 SMA angling up with price above it. Bullish + price > 200 | |
| IWM Score: Daily: – 3 Weekly: -4 Monthly: 2 | – Touched Bottom of Keltner and sliding down – Rainbow EMAs – price < 200 | – Momentum Bearish MACD -DMI bearish – 10 SMA < 34 EMA – Structurally broke bearish + price > 200 but, at support – touched bottom of keltner channel | + 10 SMA angling up with price below it. Bullish + price > 200 + nearing a cycle low | * keep an eye on this one. It has been leading the market down and might exhaust with the rest of this market. *currently weekly cycle at support might be a good turn around long candidate. |
| IYT Score: Daily: – 2 Weekly: -3 Monthly: 2 | – Rainbow EMA bearish – price < 200 – Bottom Keltner touch + hit multiple measured move targets. * previous gaps and targets could act as resistance. | – Momentum Bearish MACD – DMI bearish – 10 is about to cross 34 ema + price > 200 – squeeze firing up bearish | + 10 SMA angling up with price below it. Bullish + price > 200 | |
| TLT Score: Daily: -3 Weekly: – 5 Monthly: – 1 | * Rainbow EMA’s are flat – Big 200 rejection (twice). – bearish squeeze setting up – anti bearish | + MACD Momentum up but slowing – 10 sma < 34 ema but slowing – price < 200 – bottom keltner touch -cycle high – price rejecting the 34 – DMI bearish * has not taken out previous pivot high | + Show Squeeze with positive momentum w/ Cycle low – 10 sma < 34 ema but, slowing – price < 200 | * Strength in TLT could slow equities |
| GLD Score: Daily: 2 Weekly: 3 Monthly: 2 | + Momentum fast > 0 and slow + Full rainbow and a bounce at the 8 ema. + price > 200 – free bars | + 10 sma > 32 ema, price above 10 + price > 200 + MACD momo up but slowing -free bar + DMI bullish | + 10 SMA angling up with price below it. Bullish + price > 200 | |
| AUDUSD Score: Daily: -1 Weekly: – 3 Monthly: -2 | – Below 200 * Still chopping around, a break of .64081 would change market structure bullish + bullish seasonality for AUD should kick in soon. – squeezing bearish | – Below 200 – Cycle high – Bottom Keltner touched without getting lower * MOMO flat / down | – Squeeze starting w/ increasing bearish momentum – below 200 – 10 sma < 34 ema and angling down +cycle low | * Typically an indication the equities are to follow. Bearish == risk off * AUDJPY, looks the very similar but, it broke market structure bullish. |
| HG Score: Daily: 4 Weekly: 4 Monthly: 3 | + Top Keltner touch, complex pullback + MACD momentum fast and slow > 0 + Rainbow in play + price > 200 – free bar w/ big tail | + MACD Up + 10sma > 34 ema + price > 200 +Top of keltner channel touch | + price > 200 + 10 sma > 34 ema + Monthly squeeze with bullish momentum | * Interestingly enough, copper shows strength in China and by default AUD because of trade. * Shows strength in global economy, when copper is doing well, the world is usually growing. |
| BTCUSD Score: Daily: – 3 Weekly: 0 Monthly: 2 | – lost 200 – Rainbow bearish – Formed a bear flag * squeeze showing w/ decreasing momentum | + price > 200 – weekly momentum MACD down + At Cycle low near support + 10sma > 34 ema – DMI bearish – bearish squeeze | + 10sma > 34 ema + price > 200 | * Saylor bought a ton of BTC around these levels |
| China Semi Index Score: Daily: -3 Weekly: – 4 Monthly: 2 | – Price < 200 and consolidating – Rainbow EMA bearish – strength at pivot low | -Showing a bearish squeeze. – Bearish momentum – Market structural break bearish – DMI bearish – broke inside bar to the downside + 10 SMA > 34 EMA but, price below and turning down | + 10 SMA angling up with price above it. Bullish + price > 200 | |
| Mag 7 Score: Daily: – 2 Weekly: -1 Monthly: 2 | – Price lost 200and rejected – rainbow bearish | + 10 SMA > 34 EMA but, price below – DMI bearish + Entering cycle low below support – Bearish momentum MACD + price > 200 – Market structural break bearish – potential anti on MACD | + 10 SMA angling up with price above it. Bullish + Price > 200 |
My Thoughts
Possible mean reversion early in the week after Friday’s strong bear close. I still think we see a move to the pivot low. BTC is still looking very bearish as well. I will be looking for sectors that have shown weakness more so than others. Then drill into the stocks with those sectors looking for pullback opportunities.
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