That’ll teach me to record in the early hours!
This week you’re saved from seeing my face on the video because while starting the recording at past 2am and having overcome a mic issue, I didn’t realise the video cam wasn’t on!
So, a sideways week in the market doesn’t really tell the whole story does it?
As the Ukraine tragedy continues, it was another week of up/down behavior in the markets, and we still remain comfortably below the 200-dma on all the main indices.
Even with that, there are individual stocks and sectors that are bullish, like Energy, but please beware of overbought scenarios. It rarely pays to chase. It nearly always pays to be patient and wait for setups that are forming near Key Levels.
If you follow me on social media channels, you’ll have seen a note about mindset in the past couple of days.
Mindset also depends heavily on your method and Trade Plan. A great mindset with a rubbish method and plan will still not get you to being the consistent player you want to be.
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Also, a quick note to say I managed to snag a few more rooms at the 50% discounted rate for our Miami Bootcamp, and they are being taken, so if you want to be live in the room with us, please use the special booking link asap. If you don’t have that link, get in touch with Support Here.
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Current Market Behavior:
My take is that the indices are still bearish, but we are in a highly sensitive environment, where any improvement (from the West’s perspective) in Ukraine, could see a dramatic upward surge.
Failing that, the markets still have plenty of room to the downside.
The OVI Sentiment Indicator (OVIsi) is a long term bellwether that is rarely negative, and rarely negative for long. It is negative right now and the S&P closed on Friday only around 11% down from its all time high.
Energy stocks are mainly bullish but many are overbought right now, meaning that they probably have one more upward move in them before retracing or going sideways. If other sectors are sluggish when that happens, the markets will continue to drift lower.
Our SPY Swing Timer is marginally negative but not oversold, while there hasn’t been a short-term arrow for almost two weeks. With SPY’s OVI being negative I’m not looking for an immediate upswing.
Again I repeat, do not use the Market Timers as blind signals. There is a certain discretion to be deployed with these. When it comes to an SPY trade I want complete clarity. Right now a break below Friday’s low (or last Tuesday’s low) should mean further downside.
Market Outlook:
This time last week I said energy stocks were looking less overbought. Many of them surged off their 20-dma’s and now they are looking somewhat overbought.
A flirt with their 50-dma’s is even more interesting, and I’ll be patient for that.
Stock Selection:
A few decent setups today including a couple of nuggets and many learning points.
Application:
I focused my energy this week on my Consolidation Fast Filter and setups forming near Key Levels. While there are quite a few Implied Volatility Bullish Divergent stocks showing, I think it’s a high risk play right now, and prefer to see some sort of basing action first.
Software Upgrades
Big strides on upgrades and some serious game-changers coming your way as I mentioned last week.
This coming week I’ll show you a new options toy which is also great fun.
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Remember, you can play the video at 1.25x or 1.5x speed if you want to save time! I have placed all the stocks covered in today’s review in your “Latest Preview” watch list.
