08/16/2024

Hey Trader,

Earlier this week, I said we were most likely not going to break down - using technical analysis and the volume profile. 

As a refresher, take a look at Tuesday's prediction.

Traders may have been convinced this was a bear flag ready to break down, however the volume profile showed us support. Not only did that support null any possible breakdown, it also created a rip ya face off bounce. Naturally, our target was the next area of resistance - the point of control.

This happened on Wednesday. I looked at Mark and said we can't take an overnight because the only way we can go higher is if we gap above the POC.

It can't be some little song and dance for days, we need a catalyst and a cancan show. Sure enough we got that, Thursday morning, an insane reaction to jobless claims of all things. I think the market was eager to get back to the bull mode as well. 

Now we are clear, without any resistance to retest the highs. We needed to eke out a little more sizzle during the grilling season.

Here is the chart from Tuesday.

And the updated chart for comparison.

It really was the quintessential volume profile play.

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Up next, Mark has a complete market breakdown with all 4 major indexes…

Market Moves Spotlight 

By Mark Sebastian

Here are the 6 month charts of the 4 major indexes.   

If we look for one that could  break out, I’d consider the Russell 2000.

The S&P 500 is actually leading the market right now, followed by the QQQ. The IWM and DIA are trailing with the IWM performing the worst. I think that could change. How?

It could be the beneficiary if money decides AAPL going up 9 days in a row is enough.   Right now I feel like money is flowing into the market.

Now that many of the ‘name’ stocks are back at their highs, IWM is set for a rally.

The other big name I like is AMZN. It already popped on Thursday. It looks like it wants to go to 185:

The market is frothy based on the nasty rally we have seen. I would not be surprised to see some of the big Mag 7 names pull back and the smaller ones like AMZN and TSLA rally.

We could easily have a day or two of market down and VIX down in the next couple of days…or market flat VIX down.

Always be closing,

Olivia Voz and Mark Sebastian