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General market analysis: SPY: The support at $360 is still holding str...
General market analysis:
The support at $360 is still holding strong. This is the level where bull and bear are fighting hard to each other. If we look on the weekly chart, if the $360 does not hold, the next key support would be $310. That is the level where before the covid-19 crash in year 2020.
If it really happens, I anticipate that would be the potential bottom. But, we still have to see how well the $360 can hold. If based on the stage analysis, the MA30 is still clearly sloping downward. Down trend is prevailing where lower high and lower low is formed.
In my last part of today posting, I will be sharing the technical way to invest in bear market- I have shared it before, so it will be just a recap.
Next, look at QQQ. $270 is the key support level now. If it breaks below, we shall see $235, which is corresponding to the pre-covid crash price level. Btw, why I anticipate it is a potential bottom as basically all the “water/liquidity” pumped during after the covid, was almost wiped out because of the interest tightening.
Similar to the SPY, QQQ is showing a very clear downtrend pattern.
Earning season is here again. As always, NETFLIX is kicking start the earning season for the big tech. Next week will be more excited for Apple, Microsoft etc.
Neflix is showing a good earning as the subscribers increase more than double than the expected. If we look on the Neflix chart, the previous 2 earnings have been hammered it hard. The current earning is interesting, as it brings NFLX above MA30 (weekly) for the first time.
I am not a big fan of online streaming stock, but this signifies something. The stock may have reach the bottom, and forming a based (Stage 1). Let’s us observe the next retracement would be able to hold above the MA30.
Remember there are 2 criteria for the stock reversal: stock closes above MA30, and MA30 has to be sloping up. The current MA30 for Netflix, is still sloping downwards.
Current market data:
I believe that if we look on the news, there are many type of market data that seems affect the “FED decision”. The market has been moving very volatile because of these market data. CPI, job data, or even today housing data also was on the headline that bring the stock down. Feel confusion?
I would say that ignore all these economic data, just look on the CPI will do. The rest, I honestly treat them as noise. Economy is lagging behind, and do not forget that, the stock is leading forward. The stock does not bottom at the worst economy. Instead, it will move forward, and will start to reverse back to bull trend in the midst of economy downturn.
In brief, look on the CPI, and when the FED will start to be less aggressive in their voice on the interest tightening.
As mentioned previously, crude oil is strongly affected by the political position. But from the chart, the stage 4 is clear enough. Last 2 weeks they are keep talking about to cut the productions etc and cause the price to surge… but? It still not working and if the crude oil price break below the recent low of $75, lower high and lower low are formed.
My opinion is, crude oil price will be still going downward.
Note that XLE is showing a divergent pattern to crude oil. One of the reasons are the earning of the oil companies are still a lot better than the previous year.
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