Market Analysis for The Week Ahead
Bull Gap vs Bear Gap
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The new update for the PharmD_KS indicator has now been published. It now has both sections broken out for NQ and also has a wildcard ticker that you can use for anything that we may be trading. Add it to your favorites and it will be available for use. Copy the levels section (text and all starting with the first number) and it will populate your chart. See the Link here: PharmD_KS Indicator
I posted a “Trading Doggy Style Starter Kit” that I think will benefit both free and certainly paid subscribers. I will continue to build this out over time with additional videos, examples, and explanations. It was updated last week with some additional content.
Trading Doggy Style Starter Kit V2
For last week we were monitoring for the election gap to fill (5811-5813.5). A ton of eyes were on it, so this was time to cover shorts. The question from there would be whether or not it would become a durable swing low to make a new all-time high, or if it would produce another lower high. The chances of producing a durable swing low were somewhat increased in my mind last week because of the proximity to the prior week low (5845.25) and the possibility that it would trigger a LBAF. Once 5845.25 was reclaimed and held from above, the last line for sellers to see any downside continuation was 5917-5922. CPI gapped price well above that, putting bulls in full short-term control. Here is a RTH only chart of ES:
Bulls now have control over short time frames and the highest time frames. It is becoming quite difficult to suggest that bears are even in control of intermediate time frames but we still have not yet taken out last week’s high. This will be a key marker moving forward and is about the only thing sellers (barely) have in their column right now. Next week we have a holiday Monday along with inauguration, along with a Bank of Japan meeting which is quite important.
As of now Trump has launched a meme coin (I have some thoughts on this but I’ll reserve comment for now) so I could see this doing one of two things. At least in crypto so far it is unleashing some serious animal spirits. This could translate into indices as well OR it could be a situation where interest in equities wanes (they have been sideways for 2 months) and crypto takes any remaining excess buyside liquidity and we see weakness in equities.
In addition to inauguration, we have a key upcoming Bank of Japan meeting. It is probably a good time to remain nimble. I believe the first move this week will be quite important, so I took the time to include a full video discussing the nearby levels for the week.