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Do Or Die
The DeMARK Pressure indicator is a technical tool that measures the pressure of buyers and sellers in the market. It is based on the premise that the market is moved by the actions of these two groups and that their pressure can be measured. The DeMARK Pressure indicator is designed to help traders identify when these groups are exerting the most pressure and to make decisions accordingly. The DeMARK Pressure indicator is pointing to the Nasdaq going lower as it is currently in overbought territory. This means that there is more pressure from sellers than buyers and the market is due for a correction
The interplay of interest rates on technology stocks is complex, but the technicals can help traders make decisions. If interest rates go up, it will increase the cost of borrowing and put pressure on stocks. However, if rates stay the same or go down, it will be bullish for tech stocks. From a DeMARK perspective, if interest rates start going up while QQQ/SPY is below the March lows (which happens to be TDST), this will be very bearish.
The current chart pattern for bonds appears to be an inverse head and shoulders. This is a bullish pattern that occurs when prices fall to a new low, then rebound and rise to a higher low, and then rebound again and rise to a new high. This pattern is often seen as a sign that prices are about to reversal and head higher. The TLT ETF is currently close to breaking out of the DeMark Setup Trend level (blue line).
The biotech sector has been one of the strongest performers over the last couple of months. The breakaway gap up is a bullish signal that suggests that prices are about to move higher. This is often seen as a sign of a trend reversal. The MACD indicator is also rising, which is another bullish sign.
In addition, lower interest rates have made it cheaper for biotech companies to borrow money for acquisitions. This has been a key driver of consolidation in the industry, as larger companies have been able to buy up smaller rivals. Since the large rise in rates though, biotechs have been struggling.
Google is another good pattern. The double 13s and reversal pattern / breakout is enticing and hard to get too bearish on the market is this plays out. Lets stick with the idea of rates being the leading signal.