Tesla and Bitcoin Behaving like Nvidia in June - SPX and NDX Giving Contrarian Signals
NVDA beat expectations, but tech is not showing the same strength as other sectors
Last week several securities were showing a bearish dark cloud setup, they were: NDX, GOOG, NVDA, and MSFT. Additionally, META printed a bearish engulfing candle, and AMZN presented a bearish shooting star. From those bearish setups GOOG, MSFT, AMZN were confirmed, while NDX, NVDA and META have not invalidated the bearish setup. We'll visualize these patterns in the charts below.
It's fascinating to observe how the S&P 500 (SPX) has diverged from the tech-heavy Nasdaq. This highlights the importance of understanding sector-specific dynamics. While tech stocks may have underperformed, sectors like Energy, Consumer Staples, Industrials, Materials, Utilities, and Real Estate have shown stronger setups.
A key element that is studied in detail in every Weekly Compass is the Volatility Index, and last week this publication anticipated that 18.14 was the key level to watch, and the VIX indeed found rejection at 18.71. A very well measured threshold. That explains the SPX move in combination with the S/R Levels even better than the individual study of each sector.
Precious metals have rebounded strongly. Natural Gas, however, appears to be topping out. Next week, we may see coordinated movements across various commodities.
Bitcoin and Tesla are surging, reminiscent of Nvidia's June rally. It's crucial to consider underlying fundamentals and macroeconomic factors beyond technical analysis. This edition delves into these two cases. Be sure to check out the detailed fundamental analysis of Tesla for a comprehensive understanding of its business context, bullish factors, and financial performance:
I want to appreciate and welcome new subscribers, I have received questions about using the Support and Resistance Levels, please read the following publications focusing in the way of using them, there are charts that present the importance of the central level, and also the way how the different support and resistance layers encompass the price action during a week:
The Weekly Compass has a new feature which is the immediate bullish and bearish targets if the central level is crossed in any direction. Last week it worked beautifully for SPX, DJI, AMZN, IWM, GDX and others. This works for investors and for scalpers who use options and leveraged securities beyond stocks.
Today’s edition provides a historical reference of the SPX that is helpful to navigate the current rally. Don’t fight the trend, and it is normal to see a choppy week every month or every other month. Trading is about risk management and having a plan for when price moves in an unexpected direction, or in an irrational way.
The Weekly Compass analyzes: SPX, NDX, DJI, IWM, TLT, DXY, AAPL, GOOG, TSLA, MSFT, NVDA, AMZN, META, GDX, SILVER, BITCOIN or DAX. If you trade some of those securities, this publication is for you. Subscribe!
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