Transcription
There's a lot going on after hours with earnings. We're going to get to that, but I think most important is we need to talk about what happened today. We have some key levels here that we're really struggling with. We had three major things that we had to watch today. We went over them on yesterday's video and we did it as well on Saturday. I will link yesterday's video at the end of this one so that if you missed Saturdays and Mondays, you can follow along. As you know, all these videos are linked together. If you're new, welcome. But they are all linked together. You can watch them stand alone, but as the week progresses, we look at what we think is going to happen and then we see what has happened and then we adjust accordingly. So that is pretty much the best way to go in the 27 years I have been trading. So let's do it.
We look at our ranges right in here. We don't seem to be able to get through that, do we? We hit that 6750 like a ton of bricks, which was a CTA level. You started to rally, but when we really look at that rally, the important thing about it is, is this money being put to to use or is this just the Friday short squeeze? Everyone's getting out of their options. The hope was that it was not just a short squeeze. The behavior that we're seeing and the deterioration that we're starting to see is starting to lend a little more concern that it might just be that.
Before we go any further, watch this. I just want to point this out because I think it's really important. In front of you is the S&P 50-day moving average and it's the percentages above it. This one is just S5FI. And if we take a look at Friday and we compare that to Monday, you're going to notice something that is really important. The breadth did not increase in the two days. So even with the follow-through, it's not like we had this huge move of the breadth of the market. And so that's the first thing that stood out to me.
The second thing that stood out was there are three things that we need to watch. Now obviously what we want is we want the NASDAQ to lead because if the NASDAQ leads that usually leads to a much more healthier market. We take a look at the top where we tried to break out the retest from there and then the bounce. So here's where the NDX tries to take out the top. Here's the bottom. Here's the bounce. So, what we're going to do real quick is we're going to take the top of this and then we're just going to drop right to here to that low. And you'll note, where did we stop? At the 50% mark. So, for those that don't know, 50 is not a fib level, but it's a really important level for a couple reasons. It determines if you still have net sellers or net buyers. Meaning, if you flip above that, then the NDX would have net buyers in this whole space. If you flip up or stay below it, you have net sellers. So when we hit this level today, no matter how you want to cut it and this is really objective and we're always looking for things that are objective and all we've done is take the high and the low and then measure the move and say okay what transpired what transpired was complete matumbbo matumbbo matumbbo matumbbo matumbbo and then it rolled over and the cycle of crepe is complete for lack of a better term.
Now we broke that 945 level and this is where we are at after hours. Considering some of the moves after hours, not really sure how we're going to open up, but some of these really missed pretty hard. And the ones that are up, I'm kind of surprised that they are, but we definitely have some earnings we have to go through. So, the first line in the sand that you guys have to watch tomorrow really is going to be that 25, it's called 254 on the NDX. If we overlay that with the cues, it's really not that hard to see where you're at. I mean, it's it's pretty clean where you need to get through and where you're rejecting. And what we saw today and we can see these levels right here. But what we saw today and I think that this is super important to get when we're seeing this kind of behavior in here for me anyway. The one thing that I always pay attention to is how did we do in the beginning of the day versus how do we do at the end of the day. So if we broke it up into sections like that and said okay well just show me the first hour and you can see the obvious rally you know let's make this really simple so it's really clear and you can see the first you know half hour to 15 minutes of just complete debauchery and then everyone gets giddy and this is it man we're going to make it and then what happens they get hold left in a bag and then about 10:30 usually right around there you get the real move whether that move is up or down after retail's done retailing all over themselves and then you just see what happen usually that institutional time around 2:00 you could see something but this really gave us a lot of signals early on and I'll just show you them so that you can see them for yourselves.
So in front of you is a 15minute and I'll clean all this off so that you guys can learn how to do this for yourself. And all I'm going to do is just drop right to the top of that and you can see that right here this 345 on Tuesday before you gap down. So what that is is a level that people were in the index and then they got back to that level and then after this gap on Wednesday down they're going to make a decision if they want to hold or not. That's why opens and closes are the most important levels of the day and also frankly of the week. So open and closes guys you want to watch those. Can't stress that enough. So obviously you can see how we tried and then we just got mumboed over and over again. But this gave you a pretty clear indication that that's where this was heading. So, if we take a look and how we're just getting rejected over and over again up here and then if we just did something as simplistic as let's find that little sucker. Where is it? And we get the curve. And we can see this as a curve if I put it there. Oh, good. The magnet's helping me. And what we're going to do is just drop this down. Come across. And now you can kind of see that. But you can already tell from the RSI that you have a problem. Now remember when I point out these RSI things for people that are new, you can always screenshot these. And when people tell you RSI doesn't work, you can just send them this chart. You don't even have to say anything. You just send them the chart and then just watch them get irritated.
So the next thing is that we just watch that level and you can start seeing this undercut at the end of the day, but you can see the deterioration that started to happen. And once that deterioration started to happen, that's really all you needed. And from there, we just saw it get, you know, just pretty much feed upon itself. So the question becomes, what's going to get us out of this? And candidly, it's the same thing that we've been talking about on Monday and on Saturday. We need to review it because a couple things happened after hours that might actually help the case in some in some instances and others it might actually hurt it. But let's get to it. The very first thing you could see this morning just based upon how we acted on Monday and then how we're coming into Tuesday and the behavior. The most important thing that we could take from this is we always want to watch how it goes with the winners and how those winners are performing. And so the big winners obviously are Micron and we can see Micron here. We're going to drop this to a daily chart for a sec. And we can see Micron. And I'll clean all this off. Clean all my nonsense off for a second. We can see Micron here. And then of course SanDisk. And we're going to clean that off as well. And then we can see STX. And then of course we can see WDC. And we can see how all these acted today. Now the easiest thing to do is just put in the demarcation lines. And for demarcation lines we're just going to use the 12, the 22, and the 55. And we can see that Western Digital closed under the 10day moving average for the first time. We can see that STX closed under that for the first time. Okay, so just FYI, everyone uses a 10. I use a 12. I should probably really clear that up for new members. Uh, let's drop this down so that you can get it. 12, 22, 55. So I use a 12, a 22, and a 55. So we closed under that. And then if you go and take a look at SNDX, you've closed under there. And then Micron has closed under the 22. None of that is favorable. And you've had some other names, some really other decent names that have been running and they're closing under key levels as well.
So, from my standpoint, no, I don't really see something out there uh that that I need to pay attention to that's telling me anything different. This is what's happening today. And we're losing the leaders. So, when you lose the leaders, it's okay as long as you have leadership. And the bottom line is you don't have any leadership. What we saw earlier was we thought we started to see rotation, some rotation today into the IGVs and we did for a little bit of time. Not that they were going to become the new leaders, but remember we needed three things. We needed the IGV to stabilize which jury's still out on that. We needed Bitcoin to stabilize. Jury's still out there and we needed silver to stabilize and jury still out there. So, did they stabilize or did we just get an oversold bounce? And this is where it gets super interesting.
Now, in front of you is a chart, and I just call it the four horsemen because if I really want to see what's going on with the trend, I can just look at the trend. And what I want to do, and I have this on a 4 hour, and I tend to use the 4 hour more than I would use anything else. Um, I find the 4 hour for trend to just be a little bit better than a daily, frankly. I'm going to get rid of the 12 here on the 4 hour. And I just want to show you this. If we look at the MACD, here's your zero line and you're still under your zero line and you're going sideways but you still not crossed. We look at rate of change here on silver. What has happened? We are below the zero line which means you have negative rate of change after moving up and grinding into a positive rate of change. We are now back to say it with me negative rate of change. So if we just close these for a second so we can focus and then we focus down here on stochastics which is very clearly breaking out. But is it or is did it just move because we went back to neutral on the RSI? So to me in regards to silver, jury's still out here. This might have just been an oversold bounce and then because of that oversold bounce, we're getting a little giddy on silver and it's not really stabilizing.
So then what we would do is go to the next one that we're interested in and we would just drop to IGV and see what's going on there. Now this is where it gets a little interesting because if we take a look here on IGV on the 4 hour, we do have our cross. We do we are above the rate of change here of zero but the question is are we getting ready to roll back down or not and I I don't have an answer to that yet guys I don't I would say that you are still on the lower end with the RSI but this was shaping up a lot better the question really that we're going to have to face today and I think that everyone's going to have to face is is it really going to matter because we completely rejected is the leading names completely rolled over and so this becomes an area where yep we might be bottoming it is possible But we're going to have to look at three very distinctive names and three very distinctive situations that that are taking place and go from there. But we're we'll get there. The important thing is we could make an argument that rate of change, which is in the middle here, has gotten positive. We do have a cross. We're not above the zero. And we are neutral out. And we did go back to neutral and slow stochastics, too. And then we would move into Bitcoin. And we would look at Bitcoin and go, all right, pardon me. What do we have? Well, this is where it gets super interesting because on the 4 hour we got back to the zero line and we're rejecting. Then here we can see that the rate of change is trying to get over the zero line but keeps rejecting. We can see that the neutral right here we're already back to neutral which is kind of interesting and that stochastics really can't get out of its own way. So if I close all this down real quick and we just look here, we were grossly oversold on a 4 hour down to a nine. We've bounced all the way back to this area in here. And what have we gotten for it from that area? Unless you were involved in one bar for four hours, you have missed the entire move. I mean, maybe you caught, you know, 2,000, but since then, it's starting to roll over. So, what I can do is I can drop into smaller time frames and see how that's going. But that's not really giving me a lot of clarity either because what's happening is we're trying to break out, but we're going sideways. So, we're not really getting the clarity that we're looking for. What we are getting if we drop it down to a 15 is you are seeing some of these divergences here and as you're seeing and you can see where you're negative right here and positive here and you can see that those levels are holding. So I don't think that that is something that is a coincidence. I guess I'll leave it at that. So, in other words, you see where you eject right here on that RSI. And you can see it back here, too, where you have the negative RSI. And then after that, how that's pointing down. And then you can just kind of see how you're pointing up here. And so, what's happening from that level over is the inability to rally through. You're just not able to get over that area for whatever reason. I'm not saying you're not there tomorrow because someone loves something, right? But for now, you're really struggling in here and you're really in a trading range and you're not able to get out of that range.
What we always have to do is go, okay, well, do we have to look at the underlying assets that are associated with Bitcoin? And the answer is not really. No, we really don't need to do that. What we really need to do is take a a hard look at it and say, all right, well, MSTR is going to do what MSTR is going to do, up or down on it, right? So, we can look at that and just say they might have other fundamental issues that are going to drive it. So, when we look at that on a 15 and we see the lower peaks, I had a trade on this. I actually did close it today on that pop because it was actually rallying into this. It was kind of interesting because this should trade in tandem and what was happening is you were actually popping up this morning into Bitcoin dropping which was kind of weird. So, I just took advantage of it and got out. You can see we never got over that close. From a deterioration standpoint, we really can't look at MSTR or what's going on with Coin after hours, which is dropping because of Hood. And we're going to cover a couple of the names after hours because I think it's I think it's super important. But what we do have to do is we have to look at this and say to ourselves, okay, what is this telling us? Is this telling us anything of value? And the answer is not not particularly no. It's not really telling us anything.
If we go into the IGV and we go to those names, it can tell us what people are thinking. So, if we go and take a look at something like Microsoft, which is obviously a very big part, and we look at something like Microsoft today, and what we'll do here is we're going to leave all these over for a second on the daily, and we just watch what happened today. And we can see how down tests that level, tries to rally, wait for the first half hour, falls down, tries again till 11:00, and then from there, complete utter just capitulation all day. Now, a lot of people will say, "Well, it doesn't matter because you still held that previous close." Maybe, maybe it doesn't matter to me. When I see something like this after being down so much and you can't even rally up, I think it's extremely telling. And I definitely think it's a problem. I don't view it as a blessing. I view it as a problem and for me when I see this I certainly want to pay attention to it. So what we did was form a dogee come across and then that was it and then the dogee broke and so this is telling us here on this hourly yeah that you have a problem if you start looking at it on the 4 hour you can you can make some arguments here about it and let's just take a look at it for a second but overall if you had to rate this what do you see happening? You can't get over the zero line. You've rejected it. you've crossed, but you're below the zero and you've worked off the oversold. That's what you've done so far here. So, I don't really view it as something that I have to be overly bullish about. I don't feel that way. I don't feel that there's enough data here. We just could be oversold. So, again, if we just throw that on the daily, you could make arguments that nothing's really moved, right? But let's go back to this 4hour.
And then what we would do is go and take a look at PLTR, which is also on the list. And of course, really has nothing to do on the negative side with AI. I mean, it's not like AI is eating PLTR. PLTR is is really AI and and and in that theory in regards to what's happening in defense spending. So, it really doesn't get any cleaner, right? But then you can see these kinds of rallies and then the fails and then you can see that the RSI you're trying to get over on the rate of change, but you're still down here. So, what happened? We hit a resistance point and we rejected extremely hard. That's what happened and it's pretty clean and we're going to get to showing you this and just how clean it was in a second. Here's Oracle. Same thing. you're trying to cross your rate of change is over, but you neutralled out. So, where where am I going with this? And I think that this is really important. The only thing that we've really have done of any consequence is just bounced off an oversold condition and zero follow-through.
Now, if we go and take a look at this, and I'll show you because it's super important to get this because it's really the one thing that we can hang our hat on. When you rallied up today, you just you came in. Now, people say, "Well, it's because, you know, everybody bought in this day." Okay. Everybody bought the first 10 minutes. Really? Okay. So, if we take a look at that and how this is playing out, this becomes a problem because what you have is you have retail buying that first hour and then institution selling and it's kind of incessant if you really look at it for that first hour and then go, okay, well then all they really did was sell. All right, first hour. All right, then all they really did was sell all day. That's not what you want to see. This is not really the behavior that you want to see. And this becomes and and it gets to be a pretty treacherous market. As always, what we do is we look at what's happening and then we make the best decisions we can.
One thing that we did really well today was we've been in a Micron trade. We put a swing on and we had another one on that we had forever and we got to the point with it when you tried to rally back up today and you couldn't even get back here. We just closed it. And I'll show you what I mean by this. So, in other words, what we're doing is we're watching it play out and then we had one on from February 6th, which actually was a small loss. And then we had one on from December 19th that was a carryover and we made over 100 points on that one. We bought it in like the 260s and we just kept going with it. But when you rally down and then you couldn't get back over here right in this area. It was just time to go. Am I going to resent that? Am I going to regret doing that? You know, you get to a point with these names where you start giving them leeway because of what they are. Like you start giving them leeway in here, right? Because oh, it's it's micron and memory and yada yada yada. and then all of a sudden the next thing you know well we're below the 12 and you're you're explaining why it's okay because it's micron and then the next thing you know you're below the 22 and closing below it. It's no different than looking at Google today that closed below the 55 and saying it's okay because they did a hundred, you know, 100 uh year bond offering and there was huge demand or another one that we closed today was Lamb and and the reason for it was we broke the 10 or the 12, I'm sorry, I keep trying to give you guys the ones you look at, but we closed the 12 and then what happened? Closed the 22, gave it a day, bounced back over, rejection, rejection after that, we closed it and that was something we were in for a very long period of time. And candidly, this is not one I really wanted to close. I was tried I fought fought it till about 230 because I wanted to see if we could get back over that 22. But once you start having trouble in here, we were up 54 on that one. But like once you're in here, and I'll show you the levels and you can't get through and you're just sitting there and what are you waiting for? You waiting for 205 again? Like what are what are you waiting for? The guy to tell you 205 can't happen. Like of course it can. Anything can happen. And and this really becomes the issue. And I'm going to get to a couple names in a second here of what's going on.
So, when we're looking at this stuff, we have to put it all together. We needed the IGV to continue to rally. People say, "Well, that's just one bar." That's all I needed, man. I needed the bar. I need like I needed that. I didn't need this rejection. I needed it to push. I didn't need Microsoft to drop 12 points off the high today and Oracle to envelop upon itself, right? That's not what what we needed to happen. We needed to see Bitcoin push and it didn't. Right? Now, you're struggling with the 70 level. We needed silver to stabilize. Maybe it did, maybe it didn't, right? Maybe it looks to me like out of everything that we needed like that, it looks the most stable, which is a kind of a scary statement.
Now, when we come in tomorrow, you're going to have some earnings out there. And I think it's important to touch base on this. LEU after hours did not do fantastic as everyone was hoping. LEU missed and the revenues missed and the stock's down about 8%. Hood missed on the crypto side. And so with crypto revenue being down and accounts not being open, the stock's down about six bucks. It's not the end of the world. It came down pretty hard. Um the earnings in the print look fairly decent, but the growth just wasn't there. Well, at the time recording this, I haven't listened to these conference calls. I'm getting this out before listening to the conference calls, but that's definitely not ideal. ALAB, which is a name that we, you know, we want to rally and actually had a good quarter. I just don't think it was as great as everyone thought. And you were down about 20 at one point. Looks like you're down about 12 right now. And Lyft, which really doesn't fit anything, but it's down about 16%. And I think that's important just to point it out because it's going to matter tomorrow when people come in and start looking at these prints.
On the flip side, NET came out with earnings. And this is super interesting because Net's up pretty dramatically at the time of this conference call. Now, as this conference call is playing out, I'll go to the pre and the post. You're seeing that we rallied all the way back up here, which of course is fantastic. What I think is so interesting is they lowered their earnings. So whether this holds or doesn't hold remains to be seen and that's something we really want to watch tomorrow just like we watched CRDO come out and just absolutely crush their guidance and all it did was just sell straight down after the first 10 minutes. So we're going to really want to watch that tomorrow and we're really going to want to watch those three things very very closely.
If you're trying to get into the community, please keep checking your email. Small batches are going out and of course I do all the onboarding calls myself. So it takes time to get everybody in that is on the wait list. And if you're trying to get on the wait list, links in description and sometimes I pin it to these videos.