June 29, 2023
G. allan Collins
SPY was flat, yesterday and went absolutely nowhere and we are still closing just below that resistance right around 436. Critical support will be that zone between 427 and 430 And if we break that support then we’re looking for a full-blown correction that could take us to lower prices and my lowest price I think we’re going to is down there at 414.
The NASDAQ 100 Triple Q’s were up .2% yeterday and we also came near resistance which is right around 367. And we did get some selling before the candle closed and this is a bearish candle because we couldn’t hold on to the gains. So, if you think about a bullish scenario where we bounce off support, we could keep going a lot higher and blast off to higher highs thats possible we are getting a little bit of hesitation as we approach that resistance at 367. So, I am officially calling this a lower high and I think there’s a good chance we’re going down toward 347 Now again, you’re instantly going to know that I am wrong, and that is completely fine to be wrong as long as you’re taking very little risk on your idea. And the very little risk on this idea is at that critical resistance right around 367. You can give it a little more wiggle room up to about 368. But again, if we start closing above that level, I’m wrong and we’re likely not getting this scenario. So you know exactly where to manage risk. Remember, this is a game of odds, and this is a game of risk management. So as long as you’re not taking on a crazy amount of risk and you have a decent amount of reward when you’re correct, you don’t even need to win 50% of your trades to be profitable. So watch that Critical Resistance zone, we’ll call it 367 to 368. If we start closing above it, I’m wrong and we’re likely going higher again towards 372 to 390. Again, this is my preferred scenario, but the market couldn’t care less what I think. So just because I think this is going to happen obviously does not mean that it will. Critical support is that retest of the breakout 355 and 347 And if we get something worse, we’re looking for the gap fill around the middle of July, which is going to take us down towards 333 to 337 and again that would take us a couple of weeks to get there. That is going to be a very painful decline if you don’t think it’s possible and you’re not at least preparing for it.
The Dow Jones. Was up.18% today and we are sitting right on top of this bunched up confluence of moving averages, which is the zone right around 338. So above or below 338 is going to tell you everything you need to know, but the critical support is still down at 336.The lower high situation in the Dow could take us up to about 341 to 343. And then if we start to get that rejection, we’re going to be looking for the break of critical support at 336 to tell us that we’re going to lower prices. But again, the Dow Jones really hasn’t gone much of anywhere this year and this industry is just going sideways. So, I’m not putting too much weight on where the Dow goes. So, I wouldn’t be surprised even if we’re getting a big tech correction if the Dow Jones stays between this range of 336 to 343
Russell 2000 ETF we were Up .49% today and the Russell is bouncing off that critical support right into what I consider critical resistance which was the breakdown below 185. So, in this scenario where the small caps are going lower, we should see a rejection from 185 and then come back down towards this gap for that. And again, these are all my preferred scenarios. That does not guarantee they’re going to happen. You’re instantly going to know I’m wrong. If we break through 185 and then we’ll be looking for a retest of the highs at 188 and then above 188 we’re back on the bull to 195. So again, you have the critical levels and all you need to do now is follow price action and don’t just assume I’m going to be correct. If we start breaking these critical resistance zones, you need to assume I’m wrong and we’re going to higher prices on the RK ETF. We were up about 2% today, sitting right at critical resistance right around 44.5 and if we break that we’re likely going up towards 46. A rejection from here could be a double top, but we’ll need to break support at 43 and then down here just below 42 and then we’ll likely go to lower prices. Yes, it is possible because we do have outstanding gaps to the downside. However, we have that bull trend, so you can stay bullish as long as we’re about 42 to 41. And then if we break that, you’re looking for a double top rejection to lower prices.
The VIX. Was down 2.11% today in the VIX is still crashing. So, we still have this very complacent low fear environment which is exactly what you are going to see in a bull market. So, this doesn’t mean. If the VIX is staying below 15, if we see the VIX spike out above 15, I think we’re going straight to 18 and that is going to be a very panic sell off. But again, we need to see it and we can’t just assume it’s going to happen.
On Bitcoin, we’re currently down about 2% and Bitcoin is chopping around exactly where we would expect, which is that resistance right around 30,500 and if we continue lower. We’re looking for possible support at 29,000 and the breakout of 28,000. Just like any bold trend, it is completely normal and healthy to get higher low pull backs into higher highs. So if Bitcoin pulls back into the breakout of 28,000, that is a buying opportunity and it is a bull trend. So, we should be looking for higher prices after we bounce from that support zone. On Amazon stock, we were down. That one 1% today and I don’t love the daily candle rejection outside the upper bound band because if this was bullish, we should have no trouble pushing to the price target at 133. So even though we are likely going towards 133 to 134, you need to pay attention to the candle and this bear sucking rejection. So, what that means if we break down below the breakout at 128, we’re likely going straight. Back down towards this support trendline right around 123 or the critical support at 121. So, manage your risk right there to break at 128 and you could only stay bullish in my opinion. While we are above that breakout level.
Microsoft stock was up .38% today holding on to this support at the rising moving averages, which is 334, but if we break 334, I am looking for lower prices at 323. Above 334 and break out we could push higher again towards 350.
NVIDIA stock was down 1.81% yesterday getting rejected below a negatively sloping 5 EMA but sitting right on top of the rising 20 daily moving average at 406. On NVIDIA I consider critical support 398 to 406 and if we break that we could see a waterfall wave of selling back down towards 374. So, there is a lot of downside risk if we break down below support. If we hold support at 406 and bounce, we’re going back to 427 and above 427. We start climbing towards 448.