The Market Gets Worse, Oversold?
Hi everyone,
I hope you are having a great Thursday!
In this post I’ll concisely share my thoughts on today’s action.
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Now let’s dive in ↓
Market Action
The QQQ continued sharply lower. With two very negative days In a row after an already sharp decline, we may be a bit stretched in the short-term to the downside.
We are about 6% from the declining 50 sma.
This by no means say’s we have to rally but the odds increase of a snapback move so shorts likely have less reward/risk. If there is a gap down tomorrow I would not be surprised to see a R to G move.
However, remember that as bad things may look, they can always get worse. Oversold simply means there has been heavy selling which can always continue. Less is more right now.
The 200 sma test seems inevitable, and a likely spot for at least some consolidation.
The IWO continues the downtrend
Volume
Volume was higher on the NYSE and the Nasdaq.
Trends ( Based on QQQ)
Shortest - 5 Day SMA - Down - Below Declining
Short-term - 21 ema - Down - Below Declining
Intermediate term - 50 sma - Down - Below Declining
Longterm - 200 sma - Up - Above Rising
Group/Themes Action
Distribution signs from most of the stocks on my watchlists.
Here’s a Daily Group Performance chart from TraderLion:
Key Stocks in Deepvue
PDD double inside
META gap down but decent close off lows
CRWD 50 day test on deck?
NVDA at lows
Market Thoughts
With the market oversold, continue monitoring for RS and working on your trading system. More active traders can look to pick their spots carefully if a reversal does occur.
Would Livermore be fishing? Either that or shorting starting 2 weeks ago.
What are your thoughts on today’s action? (Leave a comment below)
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It has been a good two days for the SQQQ