Broad Market Outlook
Lower highs and lower lows usually leads to, you guessed it lower prices. With the 320 area being a prior area of small support and also in 10% correction territory for the SPY that would be my first area to keep an eye on for a potential change in trend.
We are in our 3rd week of selling after almost 25 weeks of buying, most of the recent corrections have lasted at least a month or more from peak to bottom, so we still need to be patient.
Biotech and Material stocks (Sherwin Williams, Dupont, PPG) were the two sectors free from the selling this week. This could be a place to continue to focus on this week.
Let's continue to be lighter and less aggressive with our trades while the market tries to find its footing. Support Buy Backs should be on the top of the list as we have seen a handful of the breakouts lately have been better categorized as fake outs.
During times like these are a great time to focus a majority of your energy on other income producing activities, this will help avoid burn out, help add fuel to the fire (your bankroll) and can keep you busy doing something other then trying to buy a stock as its pull back with a random stop. Being able to recognized when the fire is cooking (broad market) and focusing elsewhere for myself has been one of the main reason I have been able to stay active in the markets throughout my career. I hope the same can and will be said about yours.
MDY Mid Caps
IWM Small Caps
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Sensitive - sectors that have moderate correlations to overall market conditions.
Cyclical - sectors that are more sensitive overall market conditions.
VCR Consumer Discretionary
Defensive- sectors that tend to outperforming during sub par market conditions.
VDC Consumer Staples
IBB Bio Tech
Big Picture Set Up
Look seeing that $48 getting rejected hard showing the seller is still there in this macro level. We tried sneaking in last month but it wasn't quite ready. Let's give it the time it needs and be ready to buy the blue sky breakout when its ready!
QSR has been good to the Alpha chat since its IPO back in 2015, we don't trade this name too often however when we do, they tend to pan out. Currently QSR is still digesting the major snap back in April, in time we want to be ready for this 58 breakout.
SFIX has been battling with this $30 level for quite some time and has shown us that once it has some legs behind it, the name can really run, if we can get another few weeks setting up under this $30 level it should be ready.