7/27/2022 Trends; The Reversal Formation Continues
So, too bad I bailed out on that Long I took at the end of yesterday, but oh well. I sleep better when I don't have overnight trades, at least in these current market conditions.
Anyways, here we are, back above 3950 like I had said. 3958 brought us the new Lower High Uptrend on the 30m. We still, as of writing this, don't have a 1-Hour Uptrend signal. I wasn't looking at the market an hour ago, but I'm guessing it was signaling in the last bar with that 3968 high. We are now fighting against the lower high 30m reversal to get that next upward movement to capture it.
If we head down without it, as anything down past 3958 might be a intraday short position, you will hear me all day say how I'm not sure we can go lower without it. That being said, I'd expect big moves today. So first, the trends;
The Upside;
So to the upside, I see us snagging the 1-Hour Uptrend. I'd be a bit surprised if it continued to garner attention of the 2-Hour Uptrend, just because I think we'd have to get back up to just under 4000 in order to do so. However, if we do snag the 2-Hour Uptrend, than we can look at that as a bullish move, as the 2-Hour Uptrend would be a higher high Uptrend signal. I'd say any continued movement past this could be an entry point to go higher. Also, on the Micro levels, this surge back upwards definitely put the 5m on higher highs and higher lows. The 15m however, is just sitting in a lower high as it hasn't gone down enough since we came up to give us a low. I expect that once it does, we will also have a lower low, as that last downtrend signal was 3960.
The Downside; While we don't have that 1-Hour Uptrend, this move dragged a lot of the indicators out of oversold territory. The MFI is a lagging indicator, so it may not look like it yet, but once it catches up it should be bringing us up. Additionally, as stated, the 30m lower high has signaled to us at 3958. As that trend has had a lower low and a lower high, I see us getting pulled back down there. I really can't see us getting above 3970 with this going on.
The Breakdown;
Overall my sentiment is bearish on the day. First off, we are sitting at almost 1% high already from overnight foreign trading. Second, we have the stage set to start developing lower highs for other timelines. A big push downward without a plummet today, will help get lower 1-Hour and above signals if we can come back up here again. If we do somehow get back up to 4000 again, I'd remain super cautious on going long past that, as our Friend, the daily downtrend line, is right up there at 4030ish.
Now, the big thing that can destroy any set of trends, is some headline data. When Putin invaded Ukraine, if we were uptrending or downtrending, it wouldn't have mattered, we would have seen a plummet. So, with that, we have the FOMC Rate decision today. I see 75 as a neutral look, 50 as a bullish move, and 100 as a bearish. The clear sign has been for a 75. Then we will have the guidance afterwards. If the talk is going 50, I think we are neutral with that, as I think that assessment is what has helped us gain traction upwards. I think if the talk goes to 75 or more in September, I think we plummet, and I think we plummet hard, at least back down to the 3700 range. If we start that plummet, prepare for GDP tomorrow to likely take us lower. Also to listen for when Powell is talking, is any talk about accepting a recession (bearish) and talk of the importance of fighting inflation over the market or general economy as a whole. However, Powell is notorious for using soft handed words in his press speeches, that seems to cause at least some initial calm.
However, remember the theme for the day has been an upward push on FOMC day, before a huge drop the next day.
Economic Data to Watch;
FOMC Rate Hike is at 14:00 EST, with the follow up at 14:30. Prepare for a wild FED day.
Prior to that, we have a report on Durable Goods at 08:30 EST, and then some housing and oil reports at 10:00 EST. With oil, remember that overall this year, higher oil prices has meant lower stock prices, sans Energy Stocks.
Then we have Earnings coming in today. Lots, and lots of Earnings in fact. I won't go through all of them, but some major ones to watch are...
BTO - ADP, T-Mobile, Bristol-Myers, and Boeing to name a few
AMC - Meta, oh and Meta, and don't forget Meta. Before talking on anyone else, be prepared for Meta. It is expected they are going to miss Earnings. I see much pain for them all day. The other big one is Qualcomm, but before Qualcomm, comes Meta. If we see an overall drop early today, it'll be due to Meta, which will drag tech stocks down with it, so keep an eye on the Nasdaq in general.
So, overall again, bearish sentiment. If we seem to just tremble today and not show major moves, than just realize most investors are waiting to see that GDP numbers tomorrow so they can know that how the FED is sitting and if we are heading into a recession.
Anyways, here we are, back above 3950 like I had said. 3958 brought us the new Lower High Uptrend on the 30m. We still, as of writing this, don't have a 1-Hour Uptrend signal. I wasn't looking at the market an hour ago, but I'm guessing it was signaling in the last bar with that 3968 high. We are now fighting against the lower high 30m reversal to get that next upward movement to capture it.
If we head down without it, as anything down past 3958 might be a intraday short position, you will hear me all day say how I'm not sure we can go lower without it. That being said, I'd expect big moves today. So first, the trends;
The Upside;
So to the upside, I see us snagging the 1-Hour Uptrend. I'd be a bit surprised if it continued to garner attention of the 2-Hour Uptrend, just because I think we'd have to get back up to just under 4000 in order to do so. However, if we do snag the 2-Hour Uptrend, than we can look at that as a bullish move, as the 2-Hour Uptrend would be a higher high Uptrend signal. I'd say any continued movement past this could be an entry point to go higher. Also, on the Micro levels, this surge back upwards definitely put the 5m on higher highs and higher lows. The 15m however, is just sitting in a lower high as it hasn't gone down enough since we came up to give us a low. I expect that once it does, we will also have a lower low, as that last downtrend signal was 3960.
The Downside; While we don't have that 1-Hour Uptrend, this move dragged a lot of the indicators out of oversold territory. The MFI is a lagging indicator, so it may not look like it yet, but once it catches up it should be bringing us up. Additionally, as stated, the 30m lower high has signaled to us at 3958. As that trend has had a lower low and a lower high, I see us getting pulled back down there. I really can't see us getting above 3970 with this going on.
The Breakdown;
Overall my sentiment is bearish on the day. First off, we are sitting at almost 1% high already from overnight foreign trading. Second, we have the stage set to start developing lower highs for other timelines. A big push downward without a plummet today, will help get lower 1-Hour and above signals if we can come back up here again. If we do somehow get back up to 4000 again, I'd remain super cautious on going long past that, as our Friend, the daily downtrend line, is right up there at 4030ish.
Now, the big thing that can destroy any set of trends, is some headline data. When Putin invaded Ukraine, if we were uptrending or downtrending, it wouldn't have mattered, we would have seen a plummet. So, with that, we have the FOMC Rate decision today. I see 75 as a neutral look, 50 as a bullish move, and 100 as a bearish. The clear sign has been for a 75. Then we will have the guidance afterwards. If the talk is going 50, I think we are neutral with that, as I think that assessment is what has helped us gain traction upwards. I think if the talk goes to 75 or more in September, I think we plummet, and I think we plummet hard, at least back down to the 3700 range. If we start that plummet, prepare for GDP tomorrow to likely take us lower. Also to listen for when Powell is talking, is any talk about accepting a recession (bearish) and talk of the importance of fighting inflation over the market or general economy as a whole. However, Powell is notorious for using soft handed words in his press speeches, that seems to cause at least some initial calm.
However, remember the theme for the day has been an upward push on FOMC day, before a huge drop the next day.
Economic Data to Watch;
FOMC Rate Hike is at 14:00 EST, with the follow up at 14:30. Prepare for a wild FED day.
Prior to that, we have a report on Durable Goods at 08:30 EST, and then some housing and oil reports at 10:00 EST. With oil, remember that overall this year, higher oil prices has meant lower stock prices, sans Energy Stocks.
Then we have Earnings coming in today. Lots, and lots of Earnings in fact. I won't go through all of them, but some major ones to watch are...
BTO - ADP, T-Mobile, Bristol-Myers, and Boeing to name a few
AMC - Meta, oh and Meta, and don't forget Meta. Before talking on anyone else, be prepared for Meta. It is expected they are going to miss Earnings. I see much pain for them all day. The other big one is Qualcomm, but before Qualcomm, comes Meta. If we see an overall drop early today, it'll be due to Meta, which will drag tech stocks down with it, so keep an eye on the Nasdaq in general.
So, overall again, bearish sentiment. If we seem to just tremble today and not show major moves, than just realize most investors are waiting to see that GDP numbers tomorrow so they can know that how the FED is sitting and if we are heading into a recession.
Trade active:
Taking a short at 3962 going into the opening bell.
Comment:
Reading an article that the White House is attempting to pre-explain two negative GDP results not meaning any sort of recession. Just FYI, yes, two negative GDPs puts us into a "Technical Recession". We need higher unemployment though before we can call it an official recession.
The market news belief is that the White House knows the GDP data tomorrow will be negative, so they are attempting to paint a narrative prior to the data release.
The market news belief is that the White House knows the GDP data tomorrow will be negative, so they are attempting to paint a narrative prior to the data release.
Comment:
Just in - Twitter also announcing it is reducing hiring.
Speaking of increasing unemployment....
Speaking of increasing unemployment....
Comment:
There is at 1-Hour Uptrend signaling at 3969
Comment:
Bleh, not that it's a huge difference, but I should have waited until 10am. If I wasn't shorting at 3972, I'd definitely be shorting up around 3969 or anywhere I can snag above that.
Comment:
Couldn't hold onto it... by about 1.25 points. We either drop and come back up later, or we hold out around here for an hour.
Comment:
Well, in spite of being in a poor entry position (stupid, stupid, should have waited), the stage is now set for things to take a dive, with the 1-Hour Lower High Uptrend signal at 3975
Comment:
The 2-Hour is actually up here signaling also. Not sure we will stay up for another hour to snag it, I see a potential drop before the FOMC decision, at least back to around the opening bell level.
Comment:
If this 2-Hour signals here, I wonder if we will literally do a repeat of the beginning of June.
Comment:
Nothing unexpected in the FOMC. 75 bps rate hike.
The statement does say they will continue to look to raise rates in the same "target range". Open to interpretation. Shocker there, as the Fed never really says anything in their statements.
I'm kinda surprised at the low volume on the release so far though. Press conference coming here soon.
The statement does say they will continue to look to raise rates in the same "target range". Open to interpretation. Shocker there, as the Fed never really says anything in their statements.
I'm kinda surprised at the low volume on the release so far though. Press conference coming here soon.
Comment:
Pretty Hawkish tone so far. Kinda surprising, since he is usually so softhanded in his words. I wonder if they are trying to ready the market for another 75 bps hike in September so they can have that door open without causing massive disruption in the market later if they choose.
Interesting that he said not just evidence, but they want compelling evidence.
Interesting that he said not just evidence, but they want compelling evidence.
Comment:
Ooph... my trade was clearly no bueno today. Should have bailed before the release =\
Considering bailing on it and eating my loss.
Considering bailing on it and eating my loss.
Comment:
I don't understand the push upward based on what I'm hearing. Pretty much saying inflation reduction at the risk of anything, including a recession. Potential higher increases than expected could come, and no assuring he will reduce rates later on.
Comment:
Decided to walk away and go kayaking and hang with friends for the evening after this debacle of a day.
I did come back, and FYI, Facebook Earnings and forward guidance are awful, except that they plan to cut costs and scale back workers to save money going forward. They also got sued by the FTC to block them from acquiring a VR company and a Fitness company.
I should have known better about a bizarre post FOMC rally. I guess I thought that since all the other bizarre rallies on awful economic and market news went south for so many investors, that they wouldn't do it again. I was wrong, clearly.
That being said, unless I see some sort of continuation trend going upwards, I'm going to hold this piss poor trade until it reaches down to 3900, or close to that.
I did go and check, and surprisingly we did not get an uptrend Daily signal yet, although I wasn't looking when we were peaking at 4040.
Do I like sitting at backwards $2500, no, no I don't. However, if I hadn't been sitting on this trade, I would have shorted into this trade, so it wouldn't make sense to back off now. We did get a 2 Hour and 3 Hour Uptrend signal, I'd expect a drop after that, and see if the trends can get back in order.
Our last 1-Hour downtrend is at about 3950, so I'd like to see how things react when we hit the next 1-Hour downtrend, although I'm guessing, unless we have a serious drop in an hour (which we had going up), it will be a higher low.
We did reach up and touch the Daily downtrending line before coming back hardcore. I expect a dip in the market tomorrow, especially after Facebook posted some pretty bad results. At least I can feel good when I read that Morgan Stanley and other major Chief Investment Officers are just as baffled by the rally as I am.
I did come back, and FYI, Facebook Earnings and forward guidance are awful, except that they plan to cut costs and scale back workers to save money going forward. They also got sued by the FTC to block them from acquiring a VR company and a Fitness company.
I should have known better about a bizarre post FOMC rally. I guess I thought that since all the other bizarre rallies on awful economic and market news went south for so many investors, that they wouldn't do it again. I was wrong, clearly.
That being said, unless I see some sort of continuation trend going upwards, I'm going to hold this piss poor trade until it reaches down to 3900, or close to that.
I did go and check, and surprisingly we did not get an uptrend Daily signal yet, although I wasn't looking when we were peaking at 4040.
Do I like sitting at backwards $2500, no, no I don't. However, if I hadn't been sitting on this trade, I would have shorted into this trade, so it wouldn't make sense to back off now. We did get a 2 Hour and 3 Hour Uptrend signal, I'd expect a drop after that, and see if the trends can get back in order.
Our last 1-Hour downtrend is at about 3950, so I'd like to see how things react when we hit the next 1-Hour downtrend, although I'm guessing, unless we have a serious drop in an hour (which we had going up), it will be a higher low.
We did reach up and touch the Daily downtrending line before coming back hardcore. I expect a dip in the market tomorrow, especially after Facebook posted some pretty bad results. At least I can feel good when I read that Morgan Stanley and other major Chief Investment Officers are just as baffled by the rally as I am.
In terms of Earnings;
T-Mobile posted strong earnings and expected growth. No issue with the customer not paying the bill think like other carriers talked about.
Bristol Myers beat estimated earnings but lowered future forecasts and expected growth. So take that as a win/loss scenario.
ADP beat out estimates by a bit.
Boeing seems to have not done well, but better than expected? At least that's what I'm getting.
Side note, Spotify was down and missed earnings pretty bad. I'd sort of toss that into the social media"ish" pile.
I did read that while Google missed on earnings and lowered forecasts, I guess the upside was that it did well in Advertisement revenue, which was the big concern it was going to get hit with.
None of that seems to have affected prices a lot, at least at this point. Opening bell in 45 minutes.
At the open, I'd look for us to go up to 3965 then down until the FOMC decision, or down to like 3925 (basically 0 on the day), then up a little until the FOMC decision.