Bi-weekly Update

Weekend Annotations, Sector and Industry Context

The following content is from our main website. Please enjoy and feel free to reply with any questions.

Broad US Indices

S&P Cash

Nasdaq

Small Caps

Banks

There has been a lot of relative weakness on the financial names over the last couple of weeks. I am noticing that XLF is qualified TD Propulsion up to 40.5

Citigroup completes its TD Combo 13 on Friday. The trade here is to start to build a position on Citigroup and if it holds, look to aggressively add against a low to hold for the levered beta.

If you are looking for something to short against it, I really like MS against 100. Clean denial of TD 13 Sequential risk levels and a 9-13-9 sell at the highs. TD Price Flip down after failing Prop Up on Friday puts us in a bearish position.

China

A-shares now have close to a 70 RSI for the first time since June. I would imagine that although the bottom might be in for the higher time frame, these pullbacks will be vicious given liquidation preferences and tax selling into year end. I would be looking at the risk-reward towards the short side against this recent swing high. 

From a risk-reward standpoint, JD looks like the cleanest short with a failure to Prop Up and 12/13 on the TD Sequential. 

Hypergrowth (ARKK)

The price action is clean here that people want out. Honey money syndrome and poor price performance on some of these names means the same thing as we expect for the China stocks: relative weakness and vicious moves lower (as well as higher). These could be great longs after the turn of the new year.

PLTR for example has a qualified TD Propulsion downside target to 15. I would be waiting for that price to hit before attempting longs. 

Bond Futures

The bonds are setup well for continued downside. I would not let the ZB contract trade above the 162 area on the short, which gives around a 1 point stop for a downside target of nearly 6 points to the TDST at 155'20.

As always, if you would like this content on a regular basis during the trading day as well as market videos, webinars etc — feel free to head on over to www.pivotanalytic.com and sign up for our full platform.