*disclaimer: Not financial advice. This is my personal trade plan only. I am not qualified or licensed to advise anyone on their specific positions or trades, I am sharing my personal opinions only. Never make financial decisions based on any information on this site or any associated platforms. Always consult a professional for investment related advice and do your due diligence*
We were sent into the weekend with ‘shock and awe’ provided by the markets on Thursday and Friday. Thursday’s face-ripping rally set the bulls up nicely, but Friday’s steep retrace cast a shadow of doubt and put the markets in a peculiar situation.
With the exception of Thursday’s unemployment numbers, the upcoming week is light in news compared to what we’ve seen recently – this should allow for some ‘clean’ price action. My motto for this week: ‘Stay Nimble’. Let’s get into the charts…
- The macro situation has not changed. The trend is down and the general macro structure still suggests an eventual trip lower to monthly demand. While some relief may be seen in the short/mid term, I see no reason to call a ‘generational bottom’ anytime soon.
- If Thursday’s low (aka Weekly Demand) holds, the (B) wave towards Daily Supply is likely in progress. While this remains my primary outlook, the structure of Friday’s drop slightly weakens this thesis as I will discuss shortly. Even IF wave (A) ends up extending lower, the general HTF structure would remain the same.
- Friday’s drop was a bit more aggressive than bulls would have liked to see, but Thursday’s extreme strength from the distal of Weekly Demand cannot be ignored. My primary outlook remains the same, but bulls will have to defend Thursday’s low.
- Friday’s retrace was fairly sharp and aggressive, closing at the 0.618 fib. This is certainly not the most ideal way for the bulls to get to the 0.618, but buyers still deserve the benefit of the doubt… for now. The 0.786 fib + 20m demand will be an immensely important zone for the bulls to hold, ideally with a corrective bounce before getting there. Failure of 20m demand would be a massive red flag and essentially kill the case for upside in the short term.
- IF 20m demand fails, the count would revert back to the extended 5th wave scenario (orange path) discussed early last week. While this is only a ‘backup plan’ for now, I will be ready to shift my focus to the short side very quickly if price action dictates as such.
- IF (and only if) the indices HOLD the bull routes, I will be watching $GOOG and $NVDA for long opportunities in these fib zones. Both found reversal structures from demand and have potential for mid-term upside if the indices can cooperate. If the indices do not hold the key levels, these two setups will be abandoned.
- If (and only if) the indices FAIL to hold the key levels, I will look to $TSLA for short opportunities. $TSLA has displayed relative weakness lately and appears to be lacking waves (4) and (5) of this move down. If the indices take the alternate bearish path I will be watching 20m supply and/or any additional zones that print for short opportunities.