Market Recap for Thursday, May 18, 2023
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TraderMike 11 months ago
Two days ago I commented on the flatlining SPY that "something's gotta give soon". Little did I know that things would start heating up the next day.
Suddenly the technicals are looking better and a large part of that is that yesterday the Russell 2000 (IWM) closed above its 50 DMA for the first time in more than 2 months. The improvement in small caps also caused the "% of Stocks Above Their 50-Day Moving Averages" to climb from 415 to 48% over the last two sessions. It's looking like that might get above 50% for the first time since early March.
QQQ continued its march higher and actually made a new 52-week high today.
The other things of note are new highs swamping new lows and the number of Expansion Breakouts today (and lots of large cap tech on that list). That signal is #1 on the " Unusually Active Signals for the Day" list. Bulls will want to see those breakouts follow-through over the next few sessions.
Suddenly the technicals are looking better and a large part of that is that yesterday the Russell 2000 (IWM) closed above its 50 DMA for the first time in more than 2 months. The improvement in small caps also caused the "% of Stocks Above Their 50-Day Moving Averages" to climb from 415 to 48% over the last two sessions. It's looking like that might get above 50% for the first time since early March.
QQQ continued its march higher and actually made a new 52-week high today.
The other things of note are new highs swamping new lows and the number of Expansion Breakouts today (and lots of large cap tech on that list). That signal is #1 on the " Unusually Active Signals for the Day" list. Bulls will want to see those breakouts follow-through over the next few sessions.
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SwingScalp 11 months ago
My thinking is to keep waiting patiently to short this rally, which seems to be roughly a 50% pullback from the S&P 500 high at 4808.93 to the 3491.58 low. My take is we are in the early stages of a secular bear market, so fine-tuning my shorting skills. Breadth might be a bit better, as you point out, but there seems to me myriad weak bulls chasing the mega-cap tech and discretionary names higher and if they face some sharp disappointment, then being short should be profitable. Those heavily crowded trades can turn into a nightmare pretty quickly.
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