Technology is a Rorschach Test on Your Opinion of the MarketThat could be a perfect bull flag as well...
XLK trade ideas
XLKI do see a crack in the charts that I'm watching. The failed retest does raise a concern. The negative rsi divergent is also a red flag. When you look at the weighted average I feel the importance of XLK's direction has a huge impact in overall market direction. Based on my limited chart reading I currently hold a bearish bias as long as the trendline holds as resistance.
Sell Signal Triggered????XLK broke down from trend line and triggered a sell signal on a daily Chart. Short if it Fails at retest of trend line. Technology goes down, so does the Equity Markets!!!
XLKI think when XLK drops out of the bearish wedge that tech sector will tumble. My bias is on the short side.
$XLK Back-testing Wedge. Might Close RED/FLAT! (BEARISH!)Simple(aggressive) back-test... nothing more. Might close Red/Flat.
***Let's talk about it... ***
XLK bearish put spread BOT VERTICAL XLK 100 20 SEP 19 79/78 PUT @.23, .77 max profit.
Risk to reward ratio just under 1:3
Gives a breakeven price target of 78.77 which is 3.4% lower from the spot price at the time of trade.
Longed the 30 delta, shorted the 25 delta.
It's a lower probability trade with under 30% estimated probability.
Rationale:
XLK seems to be hugging the high side of the long term trend. It *could* continue to grind higher for the next month, or we could get another 'techwreck' during this earnings season.
IV is relatively low at the moment, so I bought a cheap bearish put spread. IV Rank is only 8%. The IV is 75% of the years HV.
AAPL and MSFT are the largest holdings.
Oddly enough Visa and Mastercard together make up 10% .
Next it's INTC, ADBE, ORCL , PYPL, and IBM which round out the top ten holding.
EPISODE 3/11: US TECH SECTOR-ELLIOTT WAVES+PARABOLIC MOVEMENT TAEpisode 3/11: US (SPX) Sectors Technical Analysis - 16th of July 2019
The Tech Sector has indeed outperformed almost all other sectors in the economy, since the 2009 financial collapse( approx. ~520% increase since the troughs of 2009).
However, with the new threats to global trade, the tech sector might be the first one to take the worse drop of all the sectors. As described by the chart, there are several indicators pointing towards that the end of the cycle(WAVE 5) might be nearing and a correction could be expected.
There are 3 key events that I see which will be necessary in determining the outcome and hence, become the cause of the next recession:
1. US-China Trade relations and overall Global Trade(Including EU/UK/Italy and other issues that are hindering trade)
2. Global Economic Slowdown in the Developing countries(Sentiment change)
3. The upcoming 2020 US Election (Geopolitical Risks)
I would not go into details regarding the potential effect of these events since they are yet to occur. Key technical note regarding the TA, is that BASE 2 which is the 2007-09 recession should've had a higher low, in which case there would have been no doubts that this is BASE 2. However, due to the Lehman Collapse the recession extended. Nevertheless, in my opinion I would still consider this drop as a BASE 2.
This is just a brief "free" and very detailed analysis. Perhaps in the future I might form a premium group, to whose members I will provide all the details of my research.
>>I do not share my ideas for the likes or the views. This channel is only dedicated to well informed research and other noteworthy and interesting market stories.>>
However, if you'd like to support me and learn more in the greatest of details, every thumbs up or follow is greatly appreciated !
-Step_Ahead_ofthemarket-
Previous episodes on the US Sectors:
EPISODE 1 : FINANCIALS
EPISODE 2 : ENERGY
Full Disclosure: This is just an opinion, you decide what to do with your own money. For any further references- contact me.
Sector rotation Cyclical to Defensive I heard some interesting commentary this week from the pros about watching for signs in the cyclical:defensive sector ratio.
I put together this chart using (XLK+XLI+XLB)/(XLP+XLU+XLV).
It is a composite of tech, industrials and materials indexes as a ratio to staples, utils and health sector indexes.
The chart ratio is about 1:1 right now.
In a late stage economy if earnings expectations plunge in the cyclicals the chart ratio should show the capital rotation into the defensive sectors.
Worth watching for a signal!
Tech leads everywhere. Not the most likely outcome.. but momentum is down.
Japan reports GDP on sunday night.. would a huge gap down drive risk off?
This ladies and gentlemen would be the dip to buy!
Get the deflationary risk out! Have the Fed raise rates! Then market can survive off liquidity!
XLK - Consolidating, but Negative Divergences Still AliveXLK - Update to short trade thesis.
Trading XLK short as long as negative MACD and DMI divergences linger. No new high today as market rallies, big picture chart still consolidating. Seeing SOX lag today is a good sign for being short (XLK over 20% Semiconductor weighting)
Need a breakdown soon though
breaking the uptrendcould be just a breather, but possibly good spot to take a partial short position under 77.50 $QQQ
Short XLKAbsolutely mental. This nonsense is going to reverse hard. Looking for spot 43 by end of September... Yeah, it can reverse that quickly. Take heed.
XLK Short Set-up - Uptrend break Confirmed by DMI and MACDI've been targetting XLK as a short candidate. It's 35% MSFT and AAPL at the top, with a host of other old-school tech giants dominating its members - very limited in momentum, growth names like cloud, Saas, Internet which would add risk to a short in this market.
Also,I like the 20% semiconductor exposure. Semis have obviously been on fire as everyone was caught off-sides trying to short their weak fundamentals, but INTC's report and overall exhaustion puts semis as a prime sector to short.
A break of the XLK uptrend would be confirmed by the two simple momentum indicators I track - MACD (with 5-15-5 setting) and DMI.
SHORT MRKT20/Mar/2019 12:49 PM
--
I would guess spy hourly catches cloud.
--
To Papai i said:
"if amd closes below $25 this week might I suggest taking some profit. Not saying to close position. - But I think you should have an if then plan. - If at the same time XLK were to get below 72 and close below I would personally consider that affirmation for profit taking
and if qqq gets below 175 Id take off even more"
--
XLF monthly with rsi rejection with single line analysis(either that or uniformity cant remember)
So if xlk goes...
--
Would think u would have wanted to buy puts this morning few weeks out while vol is still tamed
--
PUBLISHING FOR MY RECORDS. NOT RECOMMENDATION TO BUY OR SELL. DO NOT FOLLOW ME OR LET MY OPINION BIAS YOU. DO YOUR OWN DD.
The technology sector is very overboughtThe XLKs gapped up after breaking through the $70 - 72 resistance zone and are very overbought. The last four times that they were this overbought – last July, August, October and again in February, a meaningful selloff followed. Look for some consolidation or short-term profit taking.
My definition of 'overbought' means that they are trading more than two standard deviations higher than their twenty day moving average. By definition, 95% of all trading should be within two standard deviations of the average. If trading is outside of this range, either to the upside or downside, then there is a significant chance that the short-term trend will revert.
If they do head lower there may be support around the $72 level because it was the top of the recent resistance zone.
High Probability trade on SPDR TRUST TECHNOLOGY SELECT: XLKThe following are trades setup ideas in the daily chart for SPDR TRUST TECHNOLOGY SELECT: XLK
There are 2 distinctive dotted lines labelled as
1. AI's Resistance Line
2. AI's Support Line
If price action was below the AI Resistance line AND Retested below AND eventually closed below this line, the idea is to short and take profit at AI's Support line .
Instead of relying on 100% discretionary (human) trading, the robots will provide trade execution plan and it is entirely up to the human trader's decision to follow.
some great tech ER's but nothing has changedstill downtrend from october for tech. powell rug pull? $QQQ $TECS
