Paralyzed
Join me as I organize my thoughts about the upcoming week
I made one day trade this week on Monday. The rest of the week I sat in disbelief as the market climbed higher. Let's jump in to see if I can reconnect with the market.
Market Review
You can see from my doodles that I anticipated the market checking the 20 day sma again, then failing to surpass the 50 day on its first attempt. Then a breakdown below the 20 which could be a bear trap, and then overcoming the 50d. I got the first part right, but then on Thursday it popped over the 50 day, and continued its rally on Friday. We are still below 2 final smas, the 100 and the 200. In theory, those would be the strongest supports, and thus the strongest resistance. The 100 day is clearly pointed down, while the 200 is still flat. We are up nearly 3% this week, overcoming the 10% drop from Liberation Day, when all the tariffs were announced. While 10% is a bit extreme, I’m definitely surprised that we are fully recovered. This is especially surprising because nothing has been settled. It’s possible we cannot overtake the last two smas, and we come down to test one of the supports again. To allow macd to cool off, but it could easily pop above and then rest.
The market dropped so quickly that I had to realize the loss, and now we are back up to where we were, and I’ve only recovered a very small percentage back. I’m definitely feeling bitter, and jealous of stock traders at the moment. I’ve only been taking day trades for fear that the second I finally jump back in, we will dump again. I made back about .3% this week.
I’m at break even for this call side.
Posts
Last Sunday Bespoke discussed how the 10d was overbought, with it moving up 3% this week I’d imagine it’s only moved more overbought.
Cem calling for a 40% drawdown overall, we have had 20% so far, and recovered to only -7.4% currently.
Seth pointing out the 10y yield could lead us further down.
An example of a company in flux. Suspending guidance until clarity comes, and freezing buybacks to prepare for the incoming storms.
Last post here discussing the snowball effect, or butterfly effect. As bad news happens, it spreads like a virus and brings everything down with it.
I only had a few posts bookmarked this week, and they were all bearish. They, along with me, are not aligned with what the stock market is actually doing. Are they right, and there’s more trouble ahead? Or is it like it typically is, and things are overblown, and we should just be looking at the chart?
Quick Charts
The vix is down another 9% this week. Right in the range for this year.
Up from 38 to 60 this week.
From 41 to 60.
From 35 to 43. Still in fear.
From 22 to 21, despite the market moving higher.
This week the odds are moving to handing out at 325 longer, however we still have a cut down to 300, with a raise back up to 325. This started last week, and I’m surprised to see it continue this week. Typically, odd things like that get worked out/resolved in a week.
Earnings and Events
2024 Results
Q2 Winners: ELF, FSLR, CHWY, CRWD, AVGO, ADBE, ORCL, FDX.
Q3 Winners: GS, SPOT, LMT, ENPH, TMO, RTX, MCD, PYPL, PLTR, UBER, UPST, SHOP, LLY, TTD, SE, ORCL, MU
Q3 Losers: UPS, QCOM, LRCX, MBLY, W, INTC, ROKU, SMCI, ABNB, DG, AVGO
Q4 Winners: TSLA, CVNA, PLTR, ELF, SHOP, SPOT, DIS, SNOW, DE, CRM, LULU, ULTA, AVGO
Q4 Losers: HOOD, ROKU, W, MELI, NVAX, RKT, AMAT, TGT, ORCL, ADBE, MU
2025 Results
Q1 Winners: JPM, GS, MS, NFLX, PLTR, SPOT, UBER, NET, SMCI, UPST, HOOD, MGM, ABNB, ROKU, PLUG
Q1 Losers: UPS, DECK, PYPL, ELF, TTD, TWLO, FSLR, BBY, CRWD, ADBE
Q2 Winners: JPM, TSLA, NOW, LRCX, MSFT
Q2 Losers: UNH, ENPH
Last Week
PYPL +2.9%
UPS -1.5%
KO -.4%
SPOT +3.8%
V +3.7%
SBUX +1%
FSLR -8%
CAT +5.6%
MSFT +11%
META +9%
HOOD -1.7%
QCOM -5.9%
LLY -6.9%
MA +4.9%
MCD -1.5%
AMZN +.5%
AAPL 1.9%
This Week
Interested in: PLTR DDOG SMCI AMD UPST UBER DIS NVO U CVNA DASH PTON SHOP TTD MELI NET DKNG
Thoughts
SPX has made a higher low and high. The smas are all still mostly down, but we’ve cleared all but 2. That said, the recovery is coming up against some heft resistance and tariffs still aren’t resolved.
I’ve been staying out of the market, and not watching as closely to recharge. I’ve been out of sync, and in disbelief. The market doesn’t always behave like we expect it to. Frequently, the more news we consume, the more wrong we will be.
Rating
My attempt at being clearer on my expectations for the upcoming week:
Bullish
Bullish/Neutral
Neutral/Bullish
Neutral
Neutral/Bearish
Bearish/Neutral
Bearish
I'd say we will have a #3 or #4 to chop a bit and digest this week's gains, and make a little more progress. If news comes out, then it'll turn into #7.
#3 turned out to be accurate. No real news, and some decent progress made. Will next week finally catch up to where my head thinks the market belongs? Or do we continue to chop here? I think it’s likely we attempt to make it over the smas, and fail the first time, but if no bad news comes, we probably end the week right at them, or even just over them.
Conclusion
I need to get back in a trade. This week may be telling if I’ve made the correct move starting out of the market, if resistance slaps price down. If we chop here, and move over, then I’ll enter a more regular position, and stop day trading.
Good luck out there!
As always, staying realistic and nimble is key to moving forward productively.
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