Using situational awareness to spot danger: My secret weapon
How I use SA to spot warning signs, some I'm seeing now
Key takeaway: “Don’t get bold when trades start running cold” - Mark Minervini
I’m back!
Leaders are holding up well, but are there a few cracks appearing?
Tonight, I will review all the short-term concerns I’ve identified, which helped me avoid the February correction.
Uncertainty in price action was evident again as yesterday’s breakout winners turned into today’s failed moves.
Markets digested a cool PPI number, and select names in the Semi and AI Power sectors were strong. Other leaders like NET saw heavy profit taking.
Our positions look solid as they mostly consolidate recent moves.
Tonight, I’ll:
Unpack the signs of trouble to be aware of
Focus list of setups
Market Breadth, Internals
Hot themes, Portfolio review
Let’s dive in!
QQQ
QQQ continues to perform, trading above all rising moving averages.
We are nearing resistance, and turbulent price action is emerging under the surface, though the index masks this weakness.
A decisive breakout above 541 is key to unlocking the next potential uptrend.
Until resistance is tested, expect choppy price action, making it challenging to gain traction on new positions as the market fluctuates.
We are over 6 ATRs from the 50-day moving average—extended.
SPY
SPY also had a constructive day, closing slightly green on low volume, which is perfectly acceptable.
I believe we are getting extended in the short term.
Despite the index’s positive price action, choppiness is increasing beneath the surface.
Price has held above 600, with the next major test at 614, the prior all-time high.
IWM
IWM showed relative weakness again today, pulling back after tagging the 200-day moving average and resisting there.
The move has been strong, but this index may need time to consolidate under resistance.
It remains above the short-term 10- and 21-day EMAs, which I consider constructive as long as it holds that position.
Gold
Gold is showing strength again after hugging the 21-day EMA support level and retesting the descending trend line.
It’s now back above all moving averages and appears like it could challenge the prior high.
I’m watching to see if this strength sustains or proves to be another one-day move.
Bitcoin
Bitcoin is choppy, mirroring many leading stocks.
We saw a clean retest and hold of the breakout level, aligning with the 21-day EMA support.
Currently, price is building out below the prior high, and we’re waiting to see if our recent entry survives as this base develops. The 21EMA must hold.
USD
Weakness in the dollar persisted today, with an undercut of the recent low.
Price continues to trend downward with no clear support yet.
TNX
The 10-year yield failed to follow through from Friday’s breakout candle and has weakened since. We are now testing the 50-day moving average again.
Our market indicator
Remains on a GREEN signal.
Net highs are drying up price continues to get more extended, a cautionary detail to be aware of.
Qullamaggie indicator
Our Qullamaggie indicator remains RISK ON.
We continue to trend with a risk-on backdrop.
Price is holding moving averages well, and action remains quiet and orderly— on the index level.
Things may heat up as we approach resistance, but we always follow the market’s lead, not opinions.
via Deepvue
SKFD
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