Navigating the Market with the Setups Blueprint
How to utilize modeled targets and invalidation levels for maximum precision
The market remains in a cautiously bullish regime. The rally continues, and fighting the trend can be risky; as mentioned yesterday, using specific levels to identify a bearish reversal is more effective than trying to anticipate one.
Market breadth remains weak: just 41% of the stocks listed in the S&P 500 are above their 20-day moving average, and only 46.5% are above their 50-day moving average. In the Weekly Compass, we discussed the importance of maintaining at least 50% participation, a threshold currently only being met by the 200-day moving average. This essentially shows that while momentum is bullish, there is a significant divergence. Proceeding with caution is essential, as the rally is narrow and driven by a few mega-caps.
We are already seeing some stocks signal potential reversals. Today, Micron (MU) lost its central daily level of 799, let’s keep an eye in the indecisive daily candle, a preliminary warning signal. AMD, on the other hand, recovered from its pre-market lows but is still facing resistance at the monthly level of 457.7.
Those two and INTC are showing signs of indecision, but momentum rotated today in semiconductors since NVDA and AVGO rallied over 4% and 5% respectively.
This is a good moment to recap the Setup Blueprint posted every Saturday, which outlines targets for the Magnificent Seven, U.S. indices, ETFs, and other mega-caps.
Some of the Setups posted on Saturday for this Week:
Throughout the week, we can see clean moves like NVDA, which had a weekly target of 223 (+4%) and an extended target of 232 (+7.9%). That level was surpassed this week without ever breaching the invalidation level (Central Weekly Level / CWL) of 209 (Again, the table below was posted on Saturday).
AMZN was identified as bearish last Saturday considering its technical situation, with a weekly target of 268 (-1.7%), contingent on the CWL remaining as unbroken resistance. The bearish move has been clean.
Intra-week volatility is always a factor, and other targets may be reached in a more “bumpy” way. AVGO is a good example: it breached its CWL of 424.7 on Tuesday but recovered it today with conviction. In this case, using today’s Central Daily Level of 413 helped identify the bullish reversal signal.
The Weekly Compass posted last Saturday is here:
When you subscribe to a paid plan, you gain access to technical deep dives on the SPX, NDX, DJI, IWM, SMH, and Bitcoin, as well as all of the Magnificent Seven. We also cover high-impact mega-caps such as AVGO, AMD, V, XOM, and others like COST, which is currently showing signs of a breakout.
Every analysis includes specific weekly targets based on modeled levels every week, along with invalidation levels to help protect your capital and serve as a professional reference for stop-loss placement.
When you opt into the Founding Member program, you receive daily levels for an expanded watchlist. This includes major mega-caps such as MU, ORCL, KO, BABA, SHOP, TSM, AMAT, and ASML, all of which are available in the Founding Member Exchange Hub where updated downloadable files are uploaded every day.
Daily levels act as early warning signals for reversals because they are narrower than weekly ranges. This helps swing traders make more informed decisions and allows options traders to set precise targets and risk management levels. For example, the central daily level (CDL) for the SPX yesterday was 7,383, which suggested bullish targets of 7,427 and 7,454 as long as the level held. The price opened above the CDL and found resistance at 7,454 with impressive precision. Today, 7,426 served as the central daily level, indicating 7,477 and 7,511 as the next destinations; the price ultimately consolidated today at 7,501.
The daily levels for tomorrow have already been uploaded to the Founding Member Exchange Hub. These include the SPX, SPY, QQQ, IWM, DIA, all of the Magnificent Seven, the 11 SPX sectors, ETFs for international indices, and our expanded mega-cap watchlist.
Find them here:
Have a good night everyone, see you tomorrow with the updated levels for next week.
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The content provided on SmartReveals.com is for educational and informational purposes only. All analyses, research, commentary, and other materials are intended to help users understand financial markets and are based on my own investment journal, investment concepts, and company fundamentals. Investing involves risk, including loss of principal, and past performance may not be indicative of future results. This content does not constitute investment or any type of advice. The support and resistance levels are modeled references to manage risk and anticipate potential reversals, each investor must assess their own risk tolerance to set stops.