Updates for Tuesday December 10, 2024

Click here for Signal Trades spreadsheet.

Updates 11 PM ET - Tuesday

As we wrote last night, the stage had been set for the dip to start, and on Monday NVDA investigation provided the catalyst to launch it.  Read more about that here.

Volatility is still likely to rise
VVIX (volatility of VIX) gapped on Monday as anticipated.  VIX also rose from 12.7 to 14.23.   With CPI this week and FOMC VIXEx OpEx next week, traders may feel the need to  hedge more.  VIX may spike up to tag the zone 16 - 17 before this dip is over.

NQ
Ahead of Monday, we wrote:  On NQ 1-hour chart, MACD cyan line has crossed below its signal orange line, and is forming lower high while price is forming higher high. This bearish divergence is a warning to aggressively protect your bull positions...

Before open on Monday, NQ spiked up a bit and then dropped steadily throughout the day, heralding the start of the dip.

​NQ initial support zone is  21165 - 21250.  If NQ finds enough buyers here, a new bull swing can start at this zone, and NQ will retest R1 at 21700 again.  It may rise as high as R2 at 22000 by year end.

Note that a new bull swing has to be confirmed by MACD patterns.  A dip into the support zone does not automatically launch the bull swing.

​TQQQ
Like NQ, dip has started for TQQQ.  Its initial support zone is  81.5 - 82.8.  If TQQQ finds enough buyers here, a new bull swing can start at this zone, and TQQQ will retest R1 at 88 again.  It may rise as high as R2 at 91 by year end.

SOXL 
Dip has been progressing for SOXL since Dec 4.  A new bull swing can start in the support zone of 26.8 - 27.4.   If SOXL finds enough buyers here, it will definitely retest R1 at 31.6 again, and may rise as high as R2 at 35 by year end.

TNA
​Dip has been progressing for TNA since Nov 27. A new bull swing can start in the support zone of 48 - 49.7.   If TNA finds enough buyers here, it can retest R1 at 58 again, and may rise as high as R2 at 63 by year end.

Our personal trade plan
We have placed buy orders to scale into SQQQ to capture the dip. Note that the buy orders will only get filled if NQ TQQQ retest their Monday resistance zones again.  If they don't retest and simply drop, we will not chase TQQQ down.  The very sharp drop can end suddenly, whereas a slow grind tends to last longer and yields better return.

Click here for Signal Spreadsheet.
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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.