Recap
❌ SPX did not defend 5000
✅ IWM defended 193
New 52-Week Highs vs New 52-Week Lows
NYSE New 52-Week Highs: 13 vs New 52-Week Lows: 39
Nasdaq New 52-Week Highs: 38 vs New 52-Week Lows: 210
Trend of New Lows > New Highs continues—this is bearish and a shift in the price action
McClellan Oscillator: most indices see smaller red bars (except for Nasdaq100)
New Highs - New Lows do not make a lower low
*This my personal blog and is not investment advice—I am not a financial advisor but a random person on the internet who does not have a license in finance or securities. This is my personal Substack which consists of opinions and/or general information. I may or may not have positions in any of the stocks mentioned. Don’t listen to anyone online without evaluating and understanding the risks involved and understand that you are responsible for making your own investment decisions.
Macro FUD and Rates are Back
I shared this quote before: When macro stops to matter, micro starts to matter. Unfortunately, now macro is back and micro stops to matter. Macro FUD with the Middle East and Interest Rates has caused quite a bit of risk off.
FCI index is tightening
This is an excerpt from PG 0.00%↑ ‘s earnings—the US economy and labor market remain healthy. The negative news from PG earnings was that global consumers are becoming more sensitive to price and they can no longer raise prices as it is starting to affect demand.
Oversold and Buy the Dip? Most likely
I’ve been more optimistic during this sell off because there is a lot more good news than bad news.
However, we don’t know how much further the market can drop after a bounce—$473.75 is a key volume shelf coming up and to keep in mind if this sell off continues after this upcoming bounce.
Forecast
Market is rotating like any bullish market does—traders consolidate gains on all the big winners like NVDA 0.00%↑ , etc. and rotate (and have an excuse to rotate) to the defensive sectors due to the Macro FUD.
In general, you want to buy Fear (VIX spikes) and we are in Extreme Fear based on the VIX.
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