TL;DR
- The equities market enjoyed its bear market rally but that momentum is wearing off
- We saw that in pre-market this morning with SPY price starting lower than yesterday’s close
- When the market is up and talking heads are bullish, that’s usually a good indicator for me to turn bearish
- That doesn’t mean I necessarily sell everything, but it does mean I prepare to reload my long positions again
S&P 500 / $SPY
- Topping formation just as predicted in the grey shaded box – waiting for prices to dip back down to support at $348 before loading in another round of buys
Bearish on Retail / Target
- Target missed earnings 3 quarters in a row.
- Clear bearish pennant formation
- This price structure implies lower-lows are likely
- I’m anticipating a test of ~$125 range if target misses earnings next quarter (March 2023)
Bearish on Copper / BHP
- Copper prices are falling and are expected to continue dropping
- BHP is on its way back down – support remains at $47
- There’s strong support in this price range – tested 6 times in the last 2 years
Bearish on Agriculture / Archer-Daniels-Midland
- Price structure appears to be wrapping up the second peak to a double top formation
- I’m betting this second top turns into a head and shoulders pattern and we retest support at ~$71
- I will not be adding to my position here at $94
- Instead, I’m being patient and waiting to see where price goes when we test the neckline at ~$82
- RSI is oversold
Bearish on Crypto / Bitcoin
- Two bearish signs that Bitcoin could be heading lower:
- Price is getting squeezed in a bearish pennant
- RSI is making higher-highs while price continues to make lower-highs
- My target for the lows in this cycle remains somewhere in the ~$14k range