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Friday, October 27, 2023

Weekly Wrap-up Sector Rotation $QQQ vs the Nasdaq

 This week was hell! Not because trading it was all that difficult, but because I came down with the flu, and I'm still fighting it - sneeze - and if that wasn't bad enough, now my wife has it. 

Monday I tried to listen to F.A.C.E. (Forex Analytix Community Experience), for the first time in ages, and mistakenly gave out my join webinar link, and before I knew it someone was using my id to swear in the chat area - augh. I've since contacted support, and the host, and I don't even get a response. I'm done with that!  Trading with the herd isn't a winning strategy anyhow. @ForexStopHunter #Blocked  

Today's big news makes clear why 10 senators were seen traveling to Saudi Arabia, on Oct. 20th. 

This also explains why the market has been sold - by government insiders - ahead of the news. 

Bloomberg claimed yesterday that Natural Gas was up because of a fear of a widening conflict in the area - paraphrasing - so this attack was well telegraphed. 

I'm surprised not to see Oil soaring on the news, but perhaps the Saudis are dumping oil on the market. 

Next Bloomberg @chartress brought one of their so-called experts on to explain why the $VIX remains so low, yet all he could come up with was that Put protection wasn't being put on. 

I can tell you why the $VIX remains low. It's because the market isn't expecting high volatility, anytime in the near future.

Sector Rotation 

What Bloomberg failed to report yesterday, as did CNBC, or anyone else in the lame stream media, as far as I can tell, is that the regional banking sector gaped up nearly 3% at the open.  

Perhaps that story doesn't fit the Bloomberg narrative, or maybe they were preoccupied hosting/ interviewing Janet Yellen 


The lame stream media also failed to report China up nearly 3% on Tuesday 

I was lucky enough to catch that trade, and even though I was afraid I might miss another big move to the upside, I took profits, and subsequently the rally was faded. 

Big Tech 

I warned folks to not hold big tech into earnings, and low and behold I was right again! 

If markets manage to stage a rally today, it's going to look like short covering ahead of the weekend, but if the $VIX is taken down below 20, then this rally has legs  

Judging by the way all the bears on CNBC Fast Money continue to badmouth stocks, we could see a massive short squeeze... 

Technically It comes down to whether you trust the channel on the QQQ, or the 200 day moving average target. 

$QQQ - trades in parallel range 

The $NDX looks identical, by the way.   

One possibility is that we get a rally here, and the 200 day continues to rise, providing additional support at the lower channel. 

The $COMPQ has already taken out the 200 day moving average. 

Another possibility is that we see other sectors lead the rally, while tech continues to sell off. 

Take Care, AA 


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