Trader Mike's Notes

CGEM - Cullinan Management, Inc.

The Hot IPO Pullback comes through again! This raced to a one-day 19.6% gain after signaling a Hot IPO Pullback yesterday.

X - United States Steel Corporation
X

A 17% breakout for X??? I highly recommend going through the Expansion Breakout scan for today. There were a ton of big moves which clearly reveal where money is rotating to -- IWM (small cap, Russell 2000), MDY (mid-caps), clean energy, cannabis, XLB (basic materials), etc. I'm adding a lot of stuff to my watchlists from that scan tonight.

CME - CME Group Inc.
CME

This was an impressive breakout from a Bollinger Band Squeeze. (you know I like expansions out of a squeeze!). Given its still near oversold stochastic reading, I wouldn't be surprised to see this retest its old highs around $225

LAZR - Luminar Technologies, Inc.

I happened to notice this forming during today's session & made a note to see how it ended up after the close. It's not quite a Rising Three Methods but perhaps it's close enough. Let's see if it can pop on Monday.

ABNB - Airbnb, Inc.

This should be interesting. One of my favorite setups -- the Hot IPO Pullback -- popped up today (ditto for DASH). Let's see if it triggers an entry tomorrow.

BIGC - BigCommerce Holdings, Inc.

This was my trade of the week (a close second was a similar setup in another recent IPO, RKT, on Tuesday)... a beautiful follow-through of Thursday's Hot IPO Pullback setup. This is why I love trading recent IPOs in general (low floats) & this setup in particular. I wish they all were this easy :-)

GOOG - Alphabet Inc. - Class C

nice recovery for Google. It was looking a little sad after earnings at the end of July. Now it's looking like it's itching to break out of a cup with handle(ish) pattern, which started with the Covid selloff in February.

FSLY - Fastly, Inc.

One of many interesting stocks on the Greatest Percentage Losers over the Last 5 Days scan this weekend. FSLY has been on an incredible run but the fact that TikTok is one of their largest customers caused a big drop this week. It could be broken or this pullback could be a gift. Time will tell. In the short term, it looks destined to test its 50-day moving average.

QQQ - PowerShares QQQ Trust, Series 1
QQQ

A fresh all-time high and it popped up on the Bollinger Band Squeeze and Touched the Upper Band scan tonight. This could easily turn into a walk up the upper Bollinger Band.

JPM - JP Morgan Chase & Co.
JPM

I found this and a few other financial stocks on the Expansion Pivot Buy Setup scan this weekend. (That scan essentially boils down to a stock rising above its 50 DMA with a wider than normal intraday range.) These stocks have been severely lagging the market but the action of Friday makes me sit up & take notice. JPM also appeared on these scans on Friday: Stochastic Buy Signal, Crossed Above 50 DMA, Crossed Above 20 DMA and 180 Bullish Setup. Definitely worth keeping an eye on. Upcoming earnings is a wild card though.

SPY - SPDR S&P 500
SPY

I really just want to mention the breakdown in the % of Stocks Above Their 50-Day Moving Averages (graph of that is on the General Market Overview page) today. A couple of weeks ago I wrote about how overheated it had become & mentioned the 65% level. Well today it slid from 77% to 64%. So clearly some of the froth has come out of the market. It seems like all the major indices, other than the Nasdaq, are in for tests of their own 50-day moving averages. Bulls will *really* want those levels to hold. The indices being so close to their 50 DMAs will add some exta drama to the upcoming earnings season.

SCHW - Charles Schwab Corporation (The)

Another one from the "Non-ADX 1,2,3,4 Bullish" scan. I also like that it's trying to find support at its 50-day moving average. This chart gives pretty clear-cut stop loss levels (the 50 DMA or today's low) and a price target (if that's your thing) of the June high.

DLTR - Dollar Tree, Inc.

One of tons of stocks on the "Non-ADX 1,2,3,4 Bullish" scan today. This stood out to me because it's also now closed its post-earnings gap from the end of May.

SPY - SPDR S&P 500
SPY

The melt-up we've been having came to a screeching halt today. The S&P 500 has given back about 3 weeks' worth of gains yesterday and today. Yet it's still solidly above its 50-day moving average.

Speaking of 50 DMAs, many of you know that I always keep track of the % of Stocks Above Their 50-Day Moving Averages (graph of that is on the General Market Overview page). I use that as an overbought / oversold indicator. I find it to be more useful to identify oversold than overbought conditions but once it rises into the mid-70s I get a bit worried about the market being overheated. Well it jumped above 80% a couple of weeks ago and even got above 90% last Friday! Today it plunged down to 75% as many stocks were driven back below their 50 DMAs. I view that as a healthy development (for now) as the action in many stocks had gotten ridiculous and this selloff is wringing out some excesses. My bullish side would like to see this indicator stay above 65% over the next few weeks. I'm building up a wacthlist of stocks I'd like to buy at or near their 50 DMAs

IWM - iShares Russell 2000 ETF
IWM

The Russell 2000 is the first of the major indices to slip back below its 200-day moving average. It's also notable that the financial ETF (XLF) is also below its 200-day moving average.

DAL - Delta Air Lines, Inc.
DAL

There are a few airlines on the Non-ADX 1,2,3,4 Bullish scan today. That gives a nice, clearly defined stop-loss spot (under today's low) -- assuming they trigger entries. -- Edit, the next morning during pre-market trading: The airlines are gapping down significantly so I'm pretty sure none of those setups will trigger entries. (The trigger for that setup is trading above yesterday's high price)

QQQ - PowerShares QQQ Trust, Series 1
QQQ

A dead cat bounce or the start of a lasting rally? I won't pretend to know. What I do know is that the indices have now come from having very oversold stochastic readings and sliding down their lower Bollinger Bands to now having overbought stochastic and touching or almost touching their upper Bollinger Bands. That tells me the *easy* money has been made. It does feel like we're back to a more rational market & I look forward to seeing what the scans turn up in the coming days.

GOOG - Alphabet Inc. - Class C

This isn't necessarily a Google note but I wanted to mention that it, along with a lot of other *historically quality* names, is showing up on some of the oversold scans. If you're a long term investor and looking for some bargains, those are great scans to run in times like these. I like to sort them by Grade (relative strength) and see what names I recognize which are rated A or B. A great way to build a watchlist

IWM - iShares Russell 2000 ETF
IWM

This is more of a general note than one specific to IWM. This and the Dow broker their 200-day moving averages today. All the indices are now well below their 50-day moving averages. The volume on these last few down days has been very high. For those newer traders who have never seen a decent sized decline and only know how to buy dips, it may be time to change your tactics.

This (as always) is a good time to review the General Market Overview page (in the Research Menu). I haven't trusted the rally this year because it's had poor breadth. That's very clear in the "% of Stocks Above Their 50-Day Moving Averages" indicator on that page. While the indices were cruising to all-time high after all-time high, that indicator showed that only about 50% of stocks were even above their 50-day moving averages. That kind of rally usually doesn't last for long.

SDGR - Schrodinger, Inc.

THis is why I love the "Hot IPO Pullback" scan! Up over 70% since that his a few times last week