7/31: Stock Market Preparation, Hand Picked Stocks
7/31: Stock Market Preparation, Hand Picked Stocks
For Paid Readers
My GOAL is to get you PREPARED for the week.
I do NOT care about sounding smart and filling this report with words that do not matter but, I do care about being PRODUCTIVE and giving you a report that is going to prepare you for the week.
Last week was a massive move in the markets! The market rallied on bad news (rate hike and many bad earnings).
Guys…Gals…
I tell people this ALL OF THE TIME! “Do you want to sound smart or want to make money?”
Some of the smartest people in the world are the WORST traders because they “think they know” and as a trader, you should NOT be focused on “what you know” but, you should be focused on dealing with the stuff you DO NOT KNOW.
Ray Dalio who is probably smarter than all of us said “knowing how to deal well with what you don't know is much more important than anything you know.” Dalio went as far as saying his success in the markets was not with dealing with what he knew but, dealing with what didn’t know.
We have to get prepared for the week, we have to be ready to execute when an opportunity presents itself. If you miss a big move it is the biggest you were not prepared and I want to help get you prepared for this upcoming week.
First I want to issue a big congratulations to those that caught some of our MONSTER WINNERS.
Discussing SPY SPY 0.00%↑ and QQQ QQQ 0.00%↑
We had a nice rally after the bear trap from the CPI data. This bear trap set us up for a strong rally because short sellers make aggressive rallies possible.
Any time a trap or failed breakout/breakdown occurs, the reversal is usually very strong.
We have to be cautious going into the week because the QQQ is at an area of resistance and SPY is nearing resistance as well after a 3-day monster rally.
We want CONFIRMATION!
A Strong move over $316 on QQQ 0.00%↑ would be an area of confirmation and seen as a breakout. Many people are shorting into this rally and above $316 could kill shorts and force shorts to cover
Over $417 would be an area of confirmation for bulls for the SPY 0.00%↑
We Have To Remember…
After the FOMC meeting on March 15th QQQ rallied massively before double topping which resulted in a very large selloff.
We have to realize this can happen again but, this time around IT IS DIFFERENT because of earnings!
At the end of the day this is NOT a stock market but, a market of stocks.
Look at how the market responded to AMZN and AAPL (it is a market of stocks).
Now…
By no means were the earnings great and by no means are current monetary conditions bullish.
At the end of the day, it makes sense for the market to move lower but, opinions lie, chart DO NOT LIE!
We have to be prepared if the QQQ does breakout over $316.
NOTES:
Over 316 on QQQ is a breakout level and an area where shorts may have to cover. As a result, it could create more demand.
QQQ is currently at resistance and needs to be on guard for a double top but, this does not mean being scared to go long if QQQ breaks out over 316. Price action was VERY Strong with 0 pullbacks the past 3 days
Over 417 on SPY is an area that can be seen as a breakout. This area is an area where shorts may have to cover.
As the QQQ is at resistance, the USD is now at prior resistance which could act as new support.
As prior resistance may act as new support it is worth noting that Friday the USD did break down below a multi-day sideways range.
The UD Dollar is the KING of markets and a weaker dollar is good for growth (NASDAQ).
If the dollar bounces, we want to turn our attention over to the NASDAQ (QQQ) to see how it responds. This is something to watch going into the week and maybe the biggest headline as both the NASDAQ and the Dollar are at critical points.