NASDAQ was doing a good job holding the 30m trend until the gap down we saw Friday. This gap down showed me that the range bound market is still in effect and buy low sell high is still working for my time frame. Something else I noticed during this week is that the strongest intraday trends are happening in stocks that are trying to form some kind of bottom or come out of a sideways range. Since I trade intraday trends I can't ignore that just because the daily charts are not in a strong uptrend. If the market is dictating that's where I need to be for my time frame then I'm going to listen to it and make my trades there. Also trading this way doesn't violate any of my rules, it's just different from what has been working for a long time. I care about where the big moves are happening. For a while that has been very strong up trends in growth stocks but it does feel like the market is starting to look elsewhere for new candidates, so I can't ignore that like I could when growth was going insane.
Daily charts are still uptrending with big levels on the SPY at $205/YTD break even, QQQ at $105, and IWM just holding the rising 50 day with the last swing low at $122ish. If that can't hold then big level at $120/YTD break even. There are no intraday trends in the indices right now except the Russell holding a 130m which closely resembles the daily anyway and the daily is much cleaner.
Taking a look at the watch list you can see what I mean by intraday trends coming from sideways stocks. Some of the financials and energy/material names are a good example of this. CVX, PBR, DOW, GS, JPM, AIG all holding intraday trends and presenting good price action. At the same time names like AXP, BAC, VALE are getting crushed so just be aware its a two sided market right now.
I'm also more open to taking short side trades now that they are actually working. AAPL is one I'm watching as a gauge of how well shorts are doing because now that we broke the 50 day/trend line it's a short setup that triggered. If they follow through on it then that tells me sellers might be stepping back up to the plate and can actually get some follow through from other short setups. My holding period is still pretty short term 1-5 days. Also be aware when earnings come out, I have notes on every chart with the date and some of these stocks report this week. Thanks for reading
-Michael
