Fundamentals, technicals and sentiment aligned for a massive top in the ratio of US Tech Stocks vs the Broad Market here. Positioning and expectations of traders, hedge funds and everyone were shocked recently, with a massive rotation towards value stocks and commodities that caught everyone off guard. All the alpha collected during the year for Jim Simmons funds...
Probably just a whipsaw day, but COVID stocks look weak and taking NQ (QQQ/$NDX) with it. If it gets oversold today, they'll probably pop it up Monday on "increasing COVID numbers" or some crap. Interesting that MFI dropped this far with no drop aside from the weakness yesterday afternoon.
I think this pops back up when ES gets oversold, which means more whipsaw. I might opt to take a week off here...
I think this is just a bounce and it heads lower when it gets overbought. Keep an eye on this today. Probably a down day tomorrow since Thursday is usually the weakest day of the week for the market. If tech goes down, it'll drag on S&P as well.
MFI oversold, looks like we get a bounce here. The easy money shorting COVID stocks is done, flipped my puts.
MFI heading down fast but RSI isn't. Means that the market is buying stocks while they dump futures. Usually means a melt up. Wait until MFI gets oversold, then we'll see another pump. Probably just a sideways whipsaw for a couple of days.
American elections, market instability and insecurity
Indicators in the middle.... Euros pumped everything this morning because they were severely oversold.... and US futures MFI was oversold on the daily as well. Flipped my COUP puts this morning (somehow picked the one stock that actually went down despite the huge pump), and I'm staying out until Wed. Elections.... no idea which way this is going.
Futures selling off again, looks to me like a down day Monday unless we get good news. SaaS stocks usually do a 3 day selloff....
My trade ideas for MNQ. The price may not come to me, but I I have orders in place.
All indicators now oversold, YM, FDAX, RTY, ES, and NQ on both MFI and RSI. Should bounce soon. Note NQ is gapping up. RTY and YM are flat right now.
If you're going to play the bounce, I would stay away from tech. NQ MFI hit overbought, RSI still has room for downside.
Inverted chart gives better perspective some time, looks like BIG move is pending in Nov.
Check our previous idea Rebounbded off the 11300 level as we had calculated. Nect stop? Probably 11700