Week of July 7 NQ/10Y/CL/GCA new batch of fresh record highs to start Q3!
Last week, we were looking for longs and we got them to TP at ATH for a solid 500 handle move in NQ.
From HERE - it gets a lot trickier, but lets start to walk through what we are looking for.
Nasdaq
To ME - the governing HTF Draw on Liquidity (DOL) is still the fresh FVG that was created on the quarterly chart. We saw back in Jan (Q1) and Apr (Q2) - they attacked these IRLs in fast and furious fashion early in the quarter. With us now at ATH on NQ - I can't long anything up here.
THIS WEEK - I am looking for shorts to take NQ back to the 19.7k area. This would give us a h4 and weekly long Turtle Soup setup for those brave enough - but I am still looking at that Quarterly chart which has a draw down to th 19k area.
I'm looking for NQ shorts this week. Hopefully we get something really aggressive and they dump NQ 5% and we can start looking for the HTF draw down at 18.5k - but lets keep focused and take things 1 week at a time.
10yr
Rates continued to fall this week - which is what is jucing the markets. That being said, I'm still looking for the 10yr to march down to ~3.8% before any kind of meaningful bounce. This is because the economy is starting to roll over, inflation is coming down - and the bond market knows it.
Oil had quite the week! We have a Hurricane in the Gulf of Mexico that is headed for Houston by Monday - so I expect a lot of this to be Hurricane premium. I am STILL looking for a move lower in oil - we just need to sweep the 85/85 area - hopefully this week.
Once Oil finally does roll over, this will confirm the bond markets stance of lower inflation and energy prices driven by a weakening global economy.
Gold had a steller week. I don't have any real clear bias on a weekly chart from here - but I would REALLY like to see the 2304 lows swept before the big move higher. There is a TON of liquidity down there (stops) that I can't imagine the Market Makers really want to leave intact before the real move higher.
Baero's Take - We are truly seeing some historic stuff in markets right now, and the market is insanely bifurcated.
Mag 7: +48% YTD
S&P 493: +7.5%
Russell: just went red for the year again
Between the Cyclical performers (metals and energy are late stage performers) and the massive narrowing of the market - we are way over due for a 5-10% correction. I think once we get our well-deserved correction - there will be one final swing long entry to run us into the EOQ. I plan on being flat most of swing stock positions ahead of the election, as I think the greatest bear market in the history of finance - will come in Q4 into 2025. I fully expect that the highs we print on indexes this year - won't be revisited for decades - if ever.
The madness will go on - until it doesn't.
Nobody rings a bell at the top - which is why we take it week by week.
So here is the setup I am watching for this week;
I want to see NQ drop back to a weekly IRL level and run the h4/weekly TS for potential long entries ~ 19.8k. This is the EXACT same type of setup we saw last Monday.
I want to see oil take out the 85/86 level and then reverse hard - this will confirm the bond market deflationary stance as the global economy weakens.
I am still waiting for gold to sweep the 2304 equal lows for a long entry.
Until next week - We'll be watching.
