Transcription
From a technical standpoint, we have to be happy with what happened today. I think what we have to deal with a little bit is the macro. That's definitely going to be an issue. And there's some fundamental stuff here that we have to deal with as well. I think mostly it's the uncertainty, but we have a couple key levels and some massive moves we have to go through tonight. So, let's get to it.
And I want to start with the two critical things over everything. Number one, I want to start with the cues. So, we have this 55-day moving average. I use the 55, not the 50. You should use what you're comfortable with. We have a couple developments in here, but there's two really big things. Larry noticed that 27.5% of you that watch these videos do not subscribe. Click subscribe. All notifications. These are all linked together and it helps greatly with the algorithm and I purposely do not run ads in the middle of these. So you liking, subscribing. It helps me greatly. Let's get to it.
All right. Now, let's start. Let's get into this. What are the really big things that happened here today? Number one, you are over your 55-day moving average. So I want to talk about the technicals because the other stuff we can get to really, we have to look at the technicals. We all know that there's a quote unquote ceasefire and it looks like the US was the only one that actually got the memo out of the entire gang. But if we take a look at this, we look at the open, we look at where we are, and no matter what happened today, objectively, we are above the 55-day moving average. And to make this super simple, and it does matter, we should spend time on it. To make this super simple, we get rid of everything else and we just look at the fact that you have not done this since February 2nd. We cracked or couldn't get it over, and now we are. Now, you could say, blah, whatever, man. We're over. And we have to look.
>> US after-hours movers constellation.
And as always, I do these raw and unedited, so there'll be a little bit of interruption off a speaker in the back. Nothing I can really do about it. Let's get to it. So, this matters because if we close under this, it's significant. So the good thing about today was that if we close under this 602, you know that institutions are selling. I use the 55 as a demarcation line for institutions. For those that are newer here, I'll just run through it very quickly. I use the 55 as a demarcation line. Are institutions involved? Above the 22, below the 22, are bulls in charge or bears in charge? Larry, I am in no mood. Second, if we look at the 12, do I even want to bother swing trading it? If I'm not above the 12, I don't even want to look at it. So, I literally do this top down across the board. So, if we take a look at this today, you got a major move. Something you have not had in some time. And it does warrant us taking a look at this. So, we get rid of the 12 for a second and just look at the 22 and realize test fail. Declining test fail. We're over. And it's going to take a heck of a lot to get us back under that. It's going to take a lot to get us back under that. You'd have to just go full-blown back into this and you'd be down a good 2% before you'd even see that, and you'd already have your sign from here. So, this does give us a really good indication of, hey, if we crack here, we have a problem. And so, for that, I'm grateful. I like demarcation lines. I'm not the brightest bulb. So, when I get a demarcation line, it makes my life super easy. And we got one today. I would say that, you know, your net selling on the day, the amount of volume on the selling versus the buying. Yeah, I could see why that would happen. You have all these people that bought in here and now they're getting out and saying, "All right, I want to get out of the way and see how this sets up." We did that today in the community where we sold into this versus buying. And it just made sense that if you're in this area and you're fortunate enough to catch this, or from yesterday, and you're reading the rhetoric that's going back and forth, it makes perfect sense. I'm going to do the same thing here. And this was a little different and a little more painful, but you have the same kind of volume setup here, but you're above the 12 and the 12 is pointing up. The 22, you're above. You have not been above that since here, since February 26th. And then if you look at the 55 and where you closed, and we go back to this, we have not been above this since the 6th. And this also has energy in it. So there is something to this. There's a bunch of names I want to go over too, 'cause there's some really good stories on PLTR. What does this mean? Well, I have a Doji. It's closing right on the 55. Thrilled by that? No. But they gave us a demarcation line. Now, at the close of the day, we actually went out and bought puts like right in the last hour and a half and did quite well with the trade. I bought puts for today and puts for tomorrow, closed the ones today and carried some of the others over. And the reason for this is because the way that the ceasefire talk is going, and I'm not going to show articles, you've all seen it out there. It's not going great where Iran's like, "Well, there's a ceasefire, but you're hitting Lebanon." And Israel is saying, "Well, that doesn't count. I don't even have words for this." and UAE reached out and said, "Well, we'd like to know what the ceasefire is about because they're hitting our desalination plants." So, this is what we have right now and it's a big suck salad and it is what it is, but this is what we have to deal with.
So, when we look at this, all I have to do is watch that area. And if I close under 67146, I have to then say we couldn't break above the 55 and we rejected. And so then I would be able to look at this and say, "All right, well, am I getting something similar to something like this, even though it's declining?" Or am I getting a scenario that's like this where we tried to rally up through it and we couldn't. Tried to rally, failed. Tried to rally, failed. I don't know if that's what I'm going to get. I don't know. And we have to look at it again for what it is through all time. When you break above it, and then if you fail, you have to watch these areas very closely, especially when you're declining, because it takes time when you're declining. And this is very similar to what we had in the past. So it's not that clear where you're like, "Oh, all clear." If you got it all clear today, you have nothing but time. Slow down. What? This is where people make the biggest mistakes. Because they're like, "Oh, well, the optics moved today, so I have to get in those." Why? If you bought the optics off the open, and we'll get to this. If you bought the optics off the open, how did you do today with the amount of risk that you took? It was an insane trade. Like risk versus reward. We're going to walk through that because I think it's important. There were so many better trades during the day after you allowed all this to settle down. But what we want to do is just focus on this for a second and just say to ourselves, all right, well, if we break 67146, I might have a problem there. And I just want to be aware of that. So that's where we are with the indexes. And I do think it's interesting that the SPY was not able to and the Qs were. And so that would make me want to really look at that relationship. And if you guys have been watching for some time, you know I look at this relationship between the Qs and the S&P. And I just want to see how it's going. And I would see that the S&P is down versus the Qs, meaning the Qs are above the 55-day moving average. Well, whenever we see that, that's a good sign for the market. We just have to stay above it. But we've had this declining trend here. So, and what I'll do to make this really clean, I'll get rid of this and we'll go here for a minute on these bars. So, we can just see it through the bars. And really, what we're looking for is we want the NASDAQ to lead. We always want the NASDAQ to lead. What are you looking at? You're looking at the NASDAQ divided by the SPY, which gives you relative performance. And I don't need to make it exact. I just want to get you to have an understanding of where we are and that we hit the high end of that range today. Now, we also have this undercut and we also made a higher low in here. So, there is something to this. If you don't like my open, high, low, close, you can always just turn it into a line just to get a sense of it, right? And you could see like, okay, well, maybe we are getting a change in trend and maybe we do hold this area and this is an area that we could bounce. I don't know the answer to this and I, I'm saying that over and over again on purpose because to sit here and have someone pontificate how this three, you know, country war is going as it spread out into other neighboring countries and say that you know how this is all going to end is beyond ludicrous. So we have to look at the relationship and how they're putting money to work. And this is the thing that you need to take from this. We can go look at the ES all we want, but if we just do the simple stuff and try to keep it simple, again, not the brightest bulb. So, what I like to do is go, "All right, well, they, we had all day off the open and then off the open, they bought right in here. Let's just move that one up since that was a big fail." And oh, what happened today at the open? Rejection more time than me calling Gazelle. So, then I look at that and go, "All right, well, whenever they got up there, they had net sellers." Well, who can cause that? Well, not retail. Retail can't cause that. Retail cannot cause the S&P to stay down all day, right? So, who's doing that? All right, institutions. Institutions that own cheaper are doing that. But did you really break down? And this is the part that I'm trying to wrap my noodle around over everything. With everything done, are you trapped in shorts and that's why they couldn't break down? But with all the news, with Iran continuing to do what they're doing, saying the ceasefire is over. They're not opening up the strait. This meeting got pushed from Friday to Saturday, which means it's probably not going to happen. But they're trying to get us into the close into Friday, thinking there's going to be a meeting over the weekend. I think that's where they're going with this. Just my opinion, my little tinfoil hat. This is what I have on the day.
So on the day, after everything's said and done from the open, what do I have? I have a market that couldn't get above the open. Okay. And how, what was my biggest drop on the day? 75 basis points. All right. And we were down there for a minute. So the majority of it happened within what? Let's just take where the majority of the trading happened today. All right. The majority of the trading happened today in a 50 basis point range. This is not how this ends. This ends with a strong big bar. I just keep thinking of the statement these guys say in the community where they keep saying bull pleasure and then start laughing to themselves. But what you're thinking about here is you need this big green bar that would just be like, oh, something emphatic. This is not how a bottom forms. That might be the bottom, but this is something that we really have to watch. So, what, what does this mean to me? It means that it's something that I have to take seriously and pay attention to, and that we could come back and we could gap fill, and we have to understand that. I think he's getting more and more aggressive, candidly. And people think it's a computer. It's not. It's actually a little nest outside where the office is. I don't know what to do about it, but he's getting more aggressive. So, if we take a look at the Qs and we look at something similar, let me go take a look at this on the five. Not the brightest bulb. So, what we do is we just look at this and go, "All right, well, here's the top. There's the open. All right. Well, did we ever get back to the open?" No, we couldn't all day. But optics, but stop. Just stop it. So, then you come here and you take a look at it and go, "All right, well, it's 1% on the day. Big down bar. Couldn't crack it. I would have rather if you cracked it and they ripped it in the face. They did not do that." So then we have to look at this and then go here and say, "All right, 1%." All right, so we opened up. We're down 1% on the day and everyone's giddy. The only thing that you should really be taking from this over everything is the fact that you don't have a ceasefire. You kind of do where the US is kind of in a ceasefire by themselves. Israel still attacked Lebanon. Vance is coming out and saying, "Don't worry. This kind of happens during all his experience with all kinds of ceasefires in the Middle East." I don't know how much experience he has, but okay, let's go with that. So then we have to look at this and say to ourselves, well, where are we? Are we oversold? Are we overbought? And I got rid of the pre and the post. Okay, well, you're overbought and you hit into the 55 going into PCE tomorrow, and then you have CPI on Friday. Does this seem like a spot where you should be getting super aggressive? You know, probably not. It's probably not the area. Looks like the S5 FI. We're going to have to go look at that. So, probably not. It's probably not the area that we have to, you know, really get goofy. And this is where what my point was with people like, just take it down a notch, relax, and let this all sort itself out. I do think the thing that if I could point out that was the most impressive about today was this. I actually had some puts on crude. I was actually long crude and then took it off and hedged it after and then was net short after that announcement. So, it turned into a great trade, but I think it's really impressive that with everything going on that crude oil did not break down more. I think that's really, if I could say the one thing that stood out to me today over everything, that would be the most bullish thing that I've seen. Here we have the strait not open and the oil market has that much confirmation right now that this is what's going to happen. And that takes you to the VIX before we go any further. And I think that this is important to kind of stay with that. I still can't get under 20. Now, I see the RSI on this. People say don't chart, you know, the VIX. I chart it. If it moves, I'll chart it. I don't really have a problem with not breaking that today. I just don't have any implosion after it gapped down. And that's really my problem with today. I don't have any real movement besides what happened after hours and pre-market where everybody again was extremely giddy.
So, where does this leave us? All right, so let's go take a look at the breadth and then we'll get to it. I waited to record this one so that we could be on the same page. And this is really some of the issue that I have. I wanted Wednesday to come in because it's really important to get this. So, we're going to do this line by line and you'll see why this is so significant. I would suggest to anybody to set up a chart like this. I actually think I have one set up like this in TradingView. If you follow me on there, you can just go grab it. I think it's under RT Trading. But if we get rid of that little sucker for a second, here's the 200. This is percent above the 200-day moving average. So, we made leaps and bounds today, right? No, we didn't. A matter of fact, we actually can't get above the 50. If you cannot get above the 50 on a day where you're up 3% on the market, you don't have net buyers. And that in and of itself is an issue. So, usually what I like to do with this when we start getting this close is just drop that at the 50 line, and anybody can do this. And you put a little alert there, and because you're going to forget about it, and then that little alert will go off, and it could be like a week from now or whatever, and then it goes off and you're like, "Oh, the breadth of the market's changed." So, that's the first thing. The longer end of the market, you actually had more names go under the 200-day moving average, which kind of makes sense in the S&P if you think about it from an energy perspective. And then if we take a look at the 50, we jumped. Are you over 50 yet? You're not, but you're probably going to get there very shortly if this continues. 50 over 50 is definitely an area where you start to turn. If you go back historically and look at this, it's where you turned in here, and we were able to hold back in there during the Jan-Feb until we got more cardboard and then from there we kind of fell off a cliff. And once you break that level, all the big breaks take place right around 50% of the 50-day. All of the big breaks take place right around 50% of the 50-day. All the big breaks take place. Yep. Said it three times on purpose right there. So, it usually is over when 50% flip, which kind of makes sense because if you use 50% as your level and you say to yourself that the 50-day is where institutions are. If 50% of all names have institutional support, well, then that would make sense that the market's going to be stronger, right? I mean, that just kind of makes sense if you think about it that way. Cool. So, then what we're going to do is just go to the 20-day. And this is where it gets a little concerning. Not a lot, but a little, because you're still under the 50. And if I mark off that level and then look at these peaks and say what happens at these peaks, well, we tend to like pop, pop goes the weasel, the weasel goes pop as the song goes, third base, anybody? And so what we want to do is just watch those levels and go, "All right, well, that's a 90 and we're at a 70." So yeah, maybe get another day or two push into Friday, and then everyone realizes that, you know, they're going to go have some meeting, maybe not. And then we kind of have to go from there, right? Could be an issue, could not be an issue. Cool. I'm not sweating that one as much. It's troubling that we moved that far on the 22 and the 200 didn't move, but the 50 was commensurate with it. So, I think that's good. When we get to the five, the five is all but telling you that you're setting up. And so, when I click on the five and you go and take a look at these days, you'll be hard-pressed to find the next day up when you're in here. It's not common to wind up going higher the next day when this happens. You can go mark them off yourself. Anything over 80%. That means all stocks are above their 5-day moving average. 85% of them, 83% of them. So, I think that it's out there. I think you're going to pull back, fill, and then we have to go from there. The other thing that we just want to watch because I think it, this is important because when you see this, there's the NDFI and this is what got me again. So, when we started the day at one point it was 52%, you closed under 48%. And so, you couldn't hold that. And I think that there's something to that. NDTH, just if you take a look at this on the 200 day, you're at 48.5%. So if you look at where these breaks take, they take place at that 200 day. I think that's an issue. And when we start going through this, just to kind of bring this home, they didn't rush into IGV. They took the time to sell software today, and then they went after PLTR because Barry says PLTR bad. Don't forget that he owns an inordinate amount of puts on PLTR and he just talked down his book, but okay, sure, let's go with his piece of research and his puts, but at the end of the day, PLTR did not help the market obviously in that space. But if you look at these names, all they did was get out of software. So, that's not really where we're going.
So, where we're going and what we talked about and when we went live last night. And if you are trying to get in the community, please look for the newsletter and the invite when you get it because I had to go from 5 days to 3 days due to demand. So, you only have 3 days after you get the letter to get into the community if you're on the waitlist. If you're trying to get in, there's a link in description and there'll be one posted tonight on the in the pin comments. All right, cool. So, if we look at like CRM or Workday, what did they do? They couldn't blow out of these things fast enough. Someone will come out and defend PLTR tomorrow and then it'll trade up, and then they'll sell the living heck out of it again. That's probably what happens. You can see it with like Tesla. Larry, I am in no mood with Tesla, and you can see that you couldn't even hold the 350. We shorted this today. Had an excellent trade in it. I have a lot of trades I really want to go over with you guys, but I want to get this one out as soon as possible tonight. I also think it was super interesting that AEHR was not that great and that they absolutely ripped it. Where are they going? They're going into the value names. They are 100% going in the value names. They are looking at Micron. They are looking at SanDisk. They bought EWY 'cause it's trading at seven times earnings. So that's where they went, right? Like we could see where the money went, but you didn't have any follow-through from the cash open. And I think that's a very important distinction here. And I think it's worth to look at. They really piled into the optics. I have a hard time buying these things right here in an environment like this. When we get stronger around that 55, I am all on board with these names. But in this kind of market, I don't need to be first. I'm still in that, hey, I'll take what I make on my short-term side and then I'll just kind of get out of the way and let the settle down. But these names, they definitely had a bid today, hands down. And I do think that they're worth paying attention tomorrow. Let's get through PCE. Let's try to have some world peace this evening, and we'll go from there. That's it.