Weekly Market Analysis 7/28/2024
Welcome back to another weekly market analysis! As always let’s start with the week in review and move into what to anticipate for the week ahead. If you read last weeks writeup, you would have seen the hypothesis of a pop up to 20,100 prior to filling the gap and making a decision at the lows. What do you know? As you can see from the chart below that played out nearly perfect. Price gapped up on the open Sunday right at support, rallied all of Monday and ultimately finding a high of the week early on Tuesday at 20.084.75. This gave the sellers the green light to step in and roll the market over with some force, paired with TSLA and GOOGL earnings that assisted in the sell. The gap was filled from Sunday and the full contract gap from rollover was also filled. This heaviness continued through the lows and carried momentum into Thursday where we found the low of the week at 18,883.25. Price appears to be attempting to hold the previous All time high breakout point of 19,154 and into the downward sloping channel that began on the CPI beat. Overall a clear pullback that was needed for healthy market behavior and not indicative of a panic sell by any means.
As a note for the chart above I have left the contract gap as a reference point however removed the Sunday open gap from last week as I feel it is less of a long term zone and no longer as important moving forward.
Looking ahead we start with our important data releases for the week:
Pretty big week in terms of data releases. With the FED rate decision expected to remain unchanged on Wednesday, NFP on Friday and the obvious other red folder days sprinkled in, there is ample opportunity for volatility to continue into this week. Be mindful of the times of the releases and adjust your trading plan accordingly.
Earnings for the week: (Could be the most important batch this quarter)
These earnings paired with the red folder data releases and the political uncertainty could lead to some really good moves in the market this week. Most notably the earnings we will keep tabs on are AAPL, AMZN, AMD, MSFT, META. Do not discount some of the larger financial names like MA, SOFI and PYPL. I also watch the consumer staples like SBUX for a direction for discretionary spending (and if they may want a new coffee company, wink).
Headlines moving Markets:
After a few weekends in a row with bigger news events, a weekend without a major headline is a reprieve, especially coming into a data heavy week.
The handy fear greed index is starting to lean to the fearful side. I do see this starting show in the general population and if there is any sort of selling this will creep into the extreme fear stage. However, it feels that a bounce could be in order with the way many unexperienced traders and normal investors will start to panic sell leading to the big boys buying up the market.
HERE ARE MY NQ LEVELS TO WATCH FOR THE WEEK:
We have opened here on Sunday with an immediate and continued upside pressure, right into Friday’s highs 19,297.75. My area of interest remains that 19,154.50 level which was the previous all time high breakout level. Any retest of that level and a hold should keep bulls in control, if it gives up into Friday lows 19,040.25 is that next decision point. We also appear to be holding a short time frame uptrend here that will lead us to the other end of this bearish channel which could have the upside bounce run into the 19,550-19,610 zone. A retest of the contract gap could be a real test of if the bulls keep control or will it be a good area for the sellers to step back in heavy. Above that zone puts us back into last weeks levels and beyond to all time highs if we catch a clean bid. To the downside if that low from Friday breaks down watch all the way to the 18,750ish level as the weekly low.
Chart above shows our channel and short term uptrend being formed.
If you are looking for the ES levels note that the contract gap was filled last week and the current zone is acceptance back above and into the higher price points. As far as relative strength it looks like the ES has been leading the NQ upside a bit. This could be based on the tech heavy nature of the NQ and the wider range of names in the ES. Also note small caps and the RTY saw flows coming in big time last week so watch to see if the money rotates back from the RTY and into the ES and NQ.
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.
