7/17/2022 Sunday

$SPX (monthly, log scale) following the strong bearish candle close below the key purple trendline extending from 1985 with close below monthly 5/9/20ema converged. Current monthly candle appears to be taking a break as we have been consolidating in range for the past 5 weeks.

The purple trendline extending from 1985 has been a significant influence in the past as it has acted as major rally point as support/bottom following extensive market selloffs but at the same time, its also been the turning point where it has triggered major market selloffs following loss of support.  (note: Monthly time frame for the average trader is an eternity and should not be used to trade day to day.)

$SPX (monthly, log) I wanted to simplify and show the consolidation (box) to breakout and trend progression. Right now, we have consolidation and break to the downside. We can assume momentum and moving averages will trend price lower in the next 4-6 months unless we get a major reversal starting with a close back above monthly 5/9/20ema. (Basically if you are a trend/breakout trader, you want to wait for consolidation breakout (here I used boxes to highlight the consolidations) and then ride the moving averages in the direction of the breakout.)

$SPX (weekly) consolidating sideways for the past 5 weeks and could be waiting on the last week of the month where we have FOMC July 27th along with major earnings week with all the big boys reporting ($AAPL, $AMZN, $MSFT, $GOOGL, $FB, $V, $XOM). The chart could get choppy where we break above the current base and channel, in which case we can look for rejection at the larger purple channel and weekly 20ema resistance. A more predictable course would be riding the weekly 9ema which is likely to be tested first, and then a continuation downward with a breakdown from the current base consolidation.

$SPX (daily) Current box consolidation is now well established as we held and rallied off the support on Thursday and now the short term moving averages 5/9/20ema are not significant as price is chopping sideways does not appear to want to trend as its going through the moving averages back and forth. Close below 3740 would be a clear bearish signal. Breakout above the box resistance and current channel resistance isnt as clean as we have the weekly 9ema as resistance above which should be considered resistance until we have weekly close over it. My preferred play rather than going long on the bullish breakout is to wait for the potential reversal play at triple resistance near 4096 where we have the weekly 20ema, daily supply and purple channel resistances.

$QQQ (monthly, log scale) similar to $SPX, so far we have a small consolidating base candle. If we rally higher, watch for potential reversal at the monthly 5/9/20ema above which should be considered resistance on the downtrend.

$QQQ (weekly) like $SPX consolidated sideways for over a month below 9ema will likely see a move out of this range during the FOMC and earnings week in the final week of the month.

$QQQ (daily) if we push higher similar to the $SPX plan, we have potential Descending channel resistance along with daily supply and weekly 20ema.

$IWM (monthly, log scale) consolidating above backtest support.

$IWM (weekly) sideways consolidation for 4 weeks with 9ema pushing down from above. If we push above 9ema then 20ema will be expected to defend the downtrend.

$DJI (monthly, Log scale) inside bar so far consolidating within prior months range below 5/9/20ema

$DJI (weekly) sideways consolidation for 5 weeks. Either it rides 9ema and trend down or 20ema above it until proven otherwise.

$CL_F crude oil future (monthly, log scale) Dark cloud cover in June following 6 straight green months and at the peak of the rally from the 2020 lows. Also coming off rejection at major monthly supply (from the 2008 crash). Oil has participated in major market corrections in the past as seen in recent examples in 2020 and 2008 so there’s potential this could signal the next strong leg down in the market. Current monthly candle holding above monthly 9ema and channel support with 2 weeks left until candle close. MACD converging and ready to bearcross on further weakness. In 2008, we had the monthly bearish engulfing reversal at the top, followed by a red candle close above 9ema before continued weakness and eventual crash.

$CL_F (weekly) Bulls had their chance to continue the rally but failed to capitalize on the ascending triangle as we now broke below the triangle support and holding above channel and horizontal support. We could see some consolidation here before a breakdown below the dual support which would be very bearish considering this channel carried most of the rally from the pandemic lows.

$XLE Energy sector (monthly, log scale) bearish engulfing reversal at the top of the rally that started at the 2020 pandemic lows. Also false breakout reversal back below horizontal resistance. If we lose currents supports at channel backtest and UTL (uptrend line), we could see a strong sell off towards monthly 20ema.

$XLE (weekly) breakdown below uptrend line support and holding at horizontal and channel backtest support for now.

$IBB Biotech(Monthly, log scale) pushing back above 122 level and currently bullish monthly confirmation of previous 2 hammer candles off major channel support. Approaching monthly 9ema at 129.77 which should act as resistance.

$IBB (weekly) had a bullish dual resistance breakout (double bottom and DTL)and closed above 5/9/20ema weekly. Now it has monthly 9ema and volume POC waiting above as potential reversal area.

$HGX Housing sector (monthly, arithmetic scale) Strong rejection off purple trendline which has been a key inflection point in the past. Following back to back months of spinning top (indecision) candles below purple TL resistance, we had a strong rejection candle in June. Current monthly candle rally off the horizontal support level. Historically when housing sector corrects, $SPX eventually follows.

$HGX (weekly) next up is the weekly 20ema which should act as resistance in a downtrend just as it had been strong support during the rallies in 2019 and 2020.

$IYR real estate ETF (Monthly, arithmetic scale) Following the base breakdown from ATHs, we now have a bearish monthly candle close below prior horizontal breakout level (false breakout reversal). Similar situation happened in 2008 which lead to the market crash so bearish potential is there. Unless Bulls reclaim 94.71, this could catch momentum to the downside after a narrow range inside month.

$IYT transportation(monthly, log scale) Prior months potential bullish hammer candle was negated as we closed lower with a red candle. Currently sitting above backtest support.

$IYT (weekly) if you were following this chart back in feb 2020, you would have said “if this dual support breaks, thats going to bad for the market. Same idea here. We are at key support. If it breaks we could see further trouble for the $SPX.

$SMH semiconductor (monthly, log scale) rallying off the monthly channel support.

$SMH (weekly) bullish piercing line reversal off monthly channel support. Weekly 9ema resistance and horizontal backtest waiting above.

$XLF financial (monthly, log scale) Closed below monthly 5/9/20ema converged. Now backtesting major horizontal breakout resistance level. Break below would obviously be bearish. This is no ordinary prior double top level. This is double top of 2 market crashes.

$XLP consumer staples (monthly, log scale ) shooting star to bearish engulfing reversal at ATHs. Monthly currently below 2 year uptrend line support with 5/9/20ema converged and consolidating above at horizontal support. MACD bearcross

$XLP (weekly) working on potential H&S. Watch for lower high (right shoulder) either at current 9ema or 20ema/sma above which could start the next wave down toward the neckline support.

$XLV health care(weekly, log scale) backtesting uptrend line and 20ema/sma resistance.

$XLY consumer discretionary (weekly, log scale) (includes $AMZN $TSLA) chopping around in box range for the past 2 months. Earnings week 1 week from now should determine immediate direction.

$KWEB (weekly) bearish false breakout reversal back below horizontal resistance. Holding at UTL support

$HYG High yield corp bond (monthly , log scale) closed below red UTL support and channel into another larger channel support which has been tested many times before.

$HYG (weekly) Breaking above 4 week consolidation box. Next up weekly 9ema and the black channel backtest.

$BTC (weekly, log scale) continues to consolidate sideways above weekly demand and prior ATH support. Could see a relief rally into 9ema.

$TLT (monthly) After hammering above the life time channel support and double bottom in June, current month starting off weak but holding above dual support level. Choppy action as usual.

$AAPL (monthly, log scale) rallying off backtest support. Big earnings coming up 7/28 AMC (after market close).

$AAPL (weekly) trying to break above box. Holding below 20ema with 20sma, weekly supply and finally channel backtest waiting above that could all act as resistance. Best to wait until after earnings to play the reaction and this applies to all stocks that have earnings. In addition to the more wacky price action near earnings, option prices are inflated due to increased IV making it harder to profit.

$MSFT (monthly, log scale) bearish monthly close below 20ema/sma. So far chopping around at the long term channel support. ***ER 7/26 AMC

$MSFT (weekly) above we have 20ema/sma and H&S backtest resistance. Currently consolidating and chopping around at monthly channel support zone with horizontal support at 244.50. Weekly close below will likely confirm major channel breakdown.

$GOOGL (monthly, log scale) Consolidating sideways for the past 3 months below 5/9/20ema. ***ER 7/26 AMC

$GOOGL (weekly) consolidating sideways in box range for the past 3 months. Appears to be waiting for earnings to finally break out.

$AMZN (monthly, log scale) consolidating above the monthly backtest support. *** ER 7/28 AMC

$AMZN (weekly) chopping sideways above horizontal support. Breakdown below would be a short signal. Weekly 20ema/sma above should act as resistance.

$TSLA (monthly) so far we’ve had the breakdown below consolidation and close below 5/9/20ema ****ER this wednesday 7/20 AMC

$TSLA (weekly) consolidating sideways for 8 weeks. Weekly 20ema/sma downtrending from above. All depends on earnings where this is going to resolve. If we shoot up, then we have 20ema/sma and then backtest of the triangle support (now resistance). Break below the box and we have continuation move downward.

$BRK.A (monthly, log scale) false breakout reversal confirmed as we closed back below prior breakout level with close below 5/9/20ema. First close below monthly 20ema/sma since march 2020. MACD bearcross. **ER Aug 8th.

$UNH (weekly, log scale) had a strong earnings reaction on Friday and continues to creep upwards holding above weekly 5/9/20ema.

$JNJ (monthly, Log scale) consolidating for the past 3 month following breakout. Remaining vulnerable to potential failed breakout move with monthly close below 173. ***ER this Tuesday 7/19 BMO (before market open)

$META (monthly, log) holding above horizontal support. ***ER 7/27 AMC

$V (monthly, L0g scale) uptrend line and triangle breakdown with 5/9/20ema converged. Currently rallying off horizontal support. ***ER 7/26 AMC

Most of the setups are demand/long setups. Remember you can have a higher time frame bearish outlook in the market and still daytrade these levels when they trigger for intraday gains. Remember you don’t have take every setup but knowing that you have plenty of solid setups to fall back on will make you more disciplined and avoid chop/weak/boredom trades. (Do not waste time looking for a trade or watching intraday 5/15min candles hoping for something to happen. Find a setup, set alerts, and forget about it until it triggers) Make sure to review prior triggered setups and see how they react. Also, if $SPY and the rest of the market is selling off aggressively and you are uncertain/confused – BEST to pass on long plays (or short plays if market is on an aggressive rally) or narrow focus onto just trading $SPY or sitting on hands . 1st Goal is to not lose money.

$AAL (daily) short setup at 16.10 ***ER 7/21 BMO

$AMZN (daily) short setup at 122

$ARKK (daily) short setup at 49.74

$ATVI (daily) short setup at 79.08

$BA (daily) short setup at 152.91

$BAC (4H) short setup at 35.66

$BIDU (daily) long setup at 120.15

$BKNG (daily) long setup at 1653

$BLNK (daily) short setup 19.50

$BYND (daily) short setup at 38.80

$C (daily) short setup at 51.20

$CCL (daily) long setup at 8.01 and (4h) short setup at 10.49

$DIS (daily) short setup at 106.79

$DKS (daily) short setup at 99.90

FB (daily) short setup at 194.67

$GME (daily) long setup at 94.05

$GS (daily) long setup at 274.27 and short setup at 318.28 ***ER 7/18 BMO

$LCID (daily) short setup at 24.64

$LOW (daily) short setup 192.11

$LULU (daily) short setup at 306.55

$MS (daily) long setup at 70.87 and short setup at 84.15

$NIO (daily) short setup at 25.40

$OSTK (daily) long setup at 22.46

$OKTA (daily) short setup at 117.75

$PLTR (daily) short setup at 10.53

$QS (daily) short setup at 11.85

$SNOW (daily) short setup at 178.75

$SQ (daily) short setup at 84.60

$TGT (daily) short setup at 154.43

$TLRY (daily) Long setup at 2.80. (Massive demand zone where it had rallied +90% previously near all time lows.) and short setup at 3.95

$TWLO (daily) short setup at 91.52

$UBER (daily) short setup at 25.70 and 27.41

All the images are in high resolution. If they appear small, try right clicking on the image and open in new tab or window to expand fully.

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