Futures are green across the board and we enter the week with the Nasdaq in an uptrend and the SPY is above the 10d. The Dow and Russell are still lagging just a bit.
Quick summary
Nasdaq entering day 4 of confirmed uptrend. Participate in uptrends and look for tech stocks that are entering new confirmed uptrends
SPY above 10d with flat MACD. Needs to show price strength to confirm
Financials, Industrials and Energy are all in confirmed downtrends
Bitcoin is below the 10d, but MACD has turned bullish
Nasdaq
Day 4 of uptrend in the Nasdaq and this one is definitely in the category of an uptrend that is “hated” across the board. Lot’s of indications that bearish sentiment is elevated and I think the pain trade for retail and active traders is likely higher from here. Regardless, price action is all that we should pay attention to and this is a time to be involved in the market and participating in the uptrend.
Large cap has been leading the way, but growth stocks are also in uptrend (ARKK is in uptrend) — allocate to those tech stocks that are about to enter uptrend or are also early in their confirmed uptrends. I will post some of those on twitter - but watching UBER, META, AMZN and will be watching some beaten down names to see if they can participate soon - like ABNB
Above Friday’s highs ($327.17) is price strength confirmation and spot to add. Support is around $315 and would be a stop on any new swings..
SPY
Huge sideways range since April, but good to see that we are above the 10d. We need MACD to confirm before allocating anything to SPY, but we are still in the range and have support around $404 with a gap to fill at $407. If we close below the 10d, we could see those levels come into play quickly. We need to see above $415 to get price strength confirmation and that may be the level needed to get MACD to confirm.
So, that level may also be the level to sell calls against SPY longs until we get the uptrend. Otherwise, $417 would be the more conservative spot for weekly covered calls against longs.
Similar principal applies to IWM and DOW - we just need a bit more time to confirm the uptrends.
Bitcoin
Bitcoin has been in a range since March and had a terrible week last week. However, other than trading below the trend on Thursday, it has largely held the bottom of the trend and is now working on getting back above the 10d and MACD is curling back up.
Bitcoin will be very volatile given macro risk of government legislation, but I think will participate quite well if we see a FOMO style trade happen in tech in coming weeks/months.