$TPX: Sleep Tight BearsXHB broke through an important 77.5 low volume node today and TPX has just been on fire. You might be asking how a mattress company and homebuilders are correlated well I'm playing it as a proxy and potentially one that could outperform the homebuilder index in general. You gotta have mattress for those homes :)
Wfh
Salesforce looks strongCRM has consolidated for almost 3 weeks, after gapping down on the news it had acquired Slack (WORK).
Risk reward ratio is around 3.
A potential test of the pre-gap candle lows might be in place before attempting to reach the 50sma, and subsequently the top of the gap.
OBV line has tested and is now respecting the line that was made before the gap higher.
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APPS - overextendedRSI at 90, meaning extreme overbought levels.
The lower BB has curled up, and intraday volume has been below-average.
If we see a pullback; 20ema will line-up around $21.5, to test a short-term support.
I am SHORT until we see some consolidation after this parabolic move.
$21.5 could be a good place to enter a position.
Zoom testing convoluted levelTechnical analysis
From October 19th, we have seen a 26-trading-day downtrend. The second attempt to break the trend was at the 38.2% fibonacci retracement level, which failed.
We are now trying to test the same downtrend line (Red arrow), while also testing the 61.8% fibonacci retracement level.
The 50sma which is converging with the 50% Fib; which seems to have a heavy resistance weight.
OBV is in a range.
Rotation analysis
Cloud/WFH stocks saw a big rally in response to the pandemic. With vaccine news, the gave some of it back.
Looking at the ratio of Value vs Growth in the $SPX, we still haven't broken the uptrend; indicating strength is still in play in growth.
I expect the small caps to continue to outperform if we get the stimulus that is anticipated in the next couple of months.
ZScaler inside uptrend channel (Watching!)ZS has been behaving well inside the uptrend channel drawn. When we touch the upper part of the channel, we see a pullback to the lower segment line.
RSI analysis suggests, we have difficulty going above the 70 level, however, the chart remains bullish whenever the RSI has been over the 43 RSI. A break below 40 in the RSI would be short-term bearish. -----> conditional Bull
OBV has been trending upwards since the earnings gap-up we had May 29th. -----> Bull
50sma is lining up with the lower channel line, which could work as a support, and a buy entry with low risk.