Quick recap since Monday note:
SPY price is still below 20day and 50day SMA.
QQQ managed to have 3 up days but has closed just below a resistance level. Also below the 20day and 50day SMA.
IWM remains below 20day and 50day SMA.
DIA also remains below 20day and 50day SMA. Also hovering around a resistance level.
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QQQ daily chart
Tomorrow the QQQ price will likely be under pressure because META is down a lot after hours post earnings release. Tomorrow, after close, we have the MSFT and GOOGL earnings releases.
So far, we have had 2 of the Magnificent 7 release earnings and we have 1 down (META) and 1 up (TSLA). It seems like the NBA playoffs. Game 7 is NVDA but first we have to reach game 7. In other words, a lot depends on MSFT and GOOGL tomorrow after close whether this attempt to reverse the trend continues or not.
I noticed that there has been very low volume these last 3 days. Probably because the market participants wanted to wait for the earnings releases. We also have the PCE on Friday and GDP numbers come out tomorrow.
I do not forecast or predict what will happen next. However, I sense that the probability that we break over the prior all-time highs in this go round seem low. I think we will make a lower high as a first step. This can be manifested tomorrow if the market closes down.
Then, we await an important next step. Does the markets stay above the recent low made 4 days back. If that level is broken to the downside, then we will make a lower low. That would mean we have not yet found the bottom to this downturn.
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The VIX (volatility index closed below 16 again.
That 16 level is kind of a binary number for me. I consider VIX below 15 as hope that we go higher. And VIX above 16 is risk to the downside. We have now had 2 days below 16 after the massive spike we saw before that.
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The GLD price has been hovering around the 215 level for some time now.
There is support around that 215 level. So, need to see what happens now. As we can see, the price gapped down 3 days back and then kind of stuck to that 215 level.
Price is just on the rising 20day SMA. So, we are at a brink and should know soon if the massive bull run continues or we have a bigger pullback.
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Have a good evening.
PS: I post comments on twitter (X) from time to time during the day. The handle is at AlternateTrader.