Weekly Market Analysis 7/21/2024
In a world of uncertainty, we can be confident that there will be opportunity in the markets! It seems that each weekend we are given that much more to work with, and in these summer months it is much needed. We will get to all that and more, but first let’s get into last weeks price action.
As you can see in the chart below, we finally had some bears step in and take control. The week was a textbook downtrend which was ignited by the CPI beat the week prior. The all time high, buy the rumor sell the news play came in and rolled us over through a major uptrend. This coupled with the attempted assassination of President Trump over the weekend started out last week with some continued sell side pressure. We opened Monday with an attempt to break above the 20,772 level and immediately rejected which pushed us into a decision point around the 20,625 level that I mentioned last week in the writeup. Once we got a break and hold below that level the sellers stepped up and drove the markets back down through every key level stopping right at the gap zone that we have been speaking about. That zone the 19,760 to 19,610 is the gap up from the previous contract rollover. We have made multiple attempts trying to breach the top of the zone and it has held on multiple occasions, this time, for now it is holding as well.
Looking ahead we start with our important data releases for the week:
As you can see I added a red star next to the Wednesday 0845 release. Although they are only 2 star events and flash numbers, I find that they do indeed give us some indication of the inflation numbers moving forward as well as move the algos. Just be aware to possibly be flat longer after the open or manage any open positions at that time. Of course all Red folder releases are the same play so watch out later in the week for that to influence our trading.
Earnings for the week:
Names to watch that will affect our markets are $TSLA, $GOOGL and $V. I do not directly trade earnings and am not normally trading during after hours, however, watch the broad sentiment and the moves that happen immediately and if they recover or maintain the move into the following day. Like I mentioned I watch the banks and the credit card companies because it will give a good idea on actual consumer behavior and not the data points that are released in a controlled setting.
Without further ado, news moving markets this week:
Before I hit off on any other news, this will be the big one that you will be watching. Who will take the nomination, how will this be priced into the markets, does that lead to him potentially stepping down from office prior to the end of his term? All good questions to keep in mind and how the market will react. After last weeks shooting, this news today and complete uncertainty of the US political landscape, we are in for increased volatility and need to be ready to capitalize when that opportunity comes. It is in these times, although chaotic and uncertain for many, a day traders ideal environment to make money.
With last weeks breather we have stepped right back into the neutral zone. This is a pivotal week ahead and any moves will move this needle thusly causing an eventual opposite reaction. This is a healthy area to be for markets, however I feel like its presenting itself as more fear than neutral. Watch how it moves as the week progresses and use this as a barometer of a broad market sentiment.
HERE ARE MY NQ LEVELS TO WATCH FOR THE WEEK:
At the time of writing this we are at a key structure level that I have been interested in since the new contract rolled. The zone of 19,760 to 19,610 is that gap. We have yet to fill the gap and by doing so early this week we could see a bounce from here. I am leaning to the 19,760 level to be my bullish/bearish line in the sand to open the week up. If we hold and open Monday below that level we are showing signs of acceptance down to the gap fill. Not only is the long term gap below, we have gapped open from Friday to Sunday and have not filled that level yet, 19,701.50 would be a clean target should that be the case. If that fill does not hold and we push lower Friday’s low is 19,654 and then into 19,610. These levels should act as support if price wants to sweep and move higher. If the bears maintain control, then the next area is the 19,500 price point. Should we catch a bid on the zone and break above this previous weeks downtrend then a bounce up to the 20,100 area is where decisions could be made on weather the bulls regain the momentum or fail and come back down through our gap and lower.
If I had to choose a bias I would lean to the side of a quick bounce early in the week and as data points come out and more information about the Biden situation unfolds then maybe the roll over starts in midweek and into Friday. However, these markets do what they want so I will go in unbiased and ready to trade my plan as should you. Let the market tell you what to do and do not force your will on the market!
Streaming Schedule for the Week Ahead:
Monday 0830-1100CST
Tuesday 0830-1100CST
Wednesday 0830-1100CST
Thursday 0830-1100CST
Friday: 0830-1100CST
Stream can be found here TRADECASTER
and on YOUTUBE
As always if you have any questions or comments about this writeup, my trading, the coffee or just want to say hi, please fill out the form below and leave some comments! Everything I share here is for your benefit, if you would like me to add any information or analyze some other charts please let me know as I will only add something if I am trading it otherwise.
