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Click here for Signal Trades spreadsheet. Updates 12 AM ET - Monday This is a short week with Thanksgiving on Thursday, and a light volume, short trading day on Friday. However, with FOMC minutes late Tuesday, and PCE plus GDP before market on Wednesday, be prepared for the possibility of a moderate increase in volatility just ahead of Thanksgiving. Read more articles here in preparation for this week.  Big picture context: aging bull As we started explaining last week, NQ is currently in the 4th bull cycle within the bull trend. (Bull trends last multi-months to multi-years. Bull cycles last multi-weeks to multi-months. Bull swings last multi-days to multi-weeks.)
Nasdaq percent of stocks above 200-day MA (Stockcharts.com: $NDXA200R) continues to decline, forming a pattern that typically led to bear trends in previous years. See $NDXA200R weekly chart below. Its 20-week EMA blue line is about to cross below its 200-week EMA green line. This bearish setup confirms our aging bull theory.  However, an aging bull is not a dead bull yet. Right now, equity still has declining VIX on its side. VIX finished forming a top by early Nov and began to drop hard. This is confirmed by its weekly MACD cyan line crossing below its orange signal line. What this all means is that we can expect to see volatility continuing to decline. VIX may dip into the low zone 12 - 13 before it starts to base. It is this basing pattern that will be the wake up call for bulls to prepare for rising volatility again. But no worries! It's not here yet.  NQ weekly chart below shows the 4 bull cycles so far in this bull trend that started on 12/27/22. Note NQ bullish weekly candle pattern formed recently in the rising channel shown below. So again, the bull may be aging, but it still has some strength in it.  NQ 4-hour chart below shows its MACD cyan line crossing above its signal orange line on Nov 19. This indicator was trying to tell us that a new bull swing was getting started on that date. It's a low-risk setup to scale into NQ by buying intraday dips. We discussed and took advantage of this setup with a quick TQQQ trade ahead of NVDA earnings.  To further confirm that the bull swing is in effect, VX (VIX futures) 4-hour chart below shows its MACD cyan line crossing below its signal orange line on Nov 21. This means we can expect volatility to drop more.  Knowing that equity has bullish tailwind support from VIX and VIX futures for another few weeks, we are projecting that NQ will surpass R1 at 21250 to reach R2 at 21700 in early December. However, NQ may still drive bulls crazy by dipping one more time into the support zone 20600 - 20700 before taking off on Monday. TQQQ
Low-risk setup: enter TQQQ when it dips into support zone 76 - 77. Exit at 85, unless NQ and VX MACD patterns strongly suggest bull swing is still not done yet. SOXL Low-risk setup: enter SOXL when it dips into support zone 26 - 27. Exit at 32, unless NQ and VX MACD patterns strongly suggest bull swing is still not done yet. TNA TNA is likely to gap up at open to 56 - 57 resistance zone on Monday, but then pull back some amount. Low-risk setup: enter TNA when it dips into support zone 49.7 - 50.85. Exit at 59, unless NQ and VX MACD patterns strongly suggest bull swing is still not done yet. Our personal trade plan After a couple of fumbled attempts, we bought TQQQ at 77.46 with the goal of exiting at 85. Click here for Signal Trades spreadsheet. Disclaimer The information presented here is our own personal opinion. Consider it as food for thought. We are not offering financial advice. We are not promoting any financial products. We are not registered financial advisers or licensed brokers. We make no guarantee that anything will unfold according to our projections. You are proceeding at your own risk if you follow our trades.
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