Written by Forrest Crist-Ruiz For the past week, the major indices have been very choppy. Without clear direction in the indices, volatility has increased making price swings faster and thus tougher to time. However, times like this prove how important risk management is, and if done correctly can help preserve trader's capital. With that said, let's go over a simple example of how to manage risk based on a set amount of trading capital. First,

Last week was a wild week in the cryptocurrency market. Sentiment has quickly changed from 50/50 bullish vs. bearish to almost entirely bullish in just the last 10 days. This is indicative of the significance that non-technical factors can have in the price action of cryptos. On the other hand, technical analysis of recent market action spells out clear trade opportunities that investor sentiment may ignore. Similar to the S&P 500 (SPY) being commonly used

Last week the much anticipated Robinhood IPO and several high-profile earnings announcements revealed a lot about investor sentiment and what to expect for market’s trend going forward. First, the Robinhood IPO had the potential to create an obvious indicator of a market top considering… It has created a movement that has enabled and enflamed the belief that the stock market was an easy ticket to riches in a generation of new market participants that are

Written by Forrest Crist-Ruiz The small-cap Russell 2000 index (IWM) cannot make up its mind. For the past three trading days, IWM has not been able to clear a pivotal resistance area created from the 50-Day moving average at $225. Other key sectors including Transportation (IYT) and Retail (XRT) have also been under pressure, and like IWM are struggling to hold their current price levels. With that said, there is one sector that could be

When you know how to read market action with the Opening Range you can see when and how another market is influencing your trades (for better or worse)! Put another way; you can also see when inter-market relationships are “working” or changing. For example… On Friday, the QQQ got off to a very bullish start when it gapped higher out of a consolidation pattern on its 50-day moving average. It looked like a perfect setup

July often sets up conditions for late summer rallies, as well as significant tops. As a result, July can be a frustrating and confusing period. Last week was a good example of why. I’ll start with the bearish case… #1) The market’s price action coming into last week set up the market indexes for a weak Monday, and weekend reports of rapidly increasing (and breakthrough cases) of the Covid Delta variant provided the news for

Written by Forrest Crist-Ruiz The past week's earnings have set the market stage with large tech companies such as Apple, Google, and Microsoft beating earnings estimates. With that said, prices look to be waning not only in the large tech companies, but in the overall market. This could be related to other factors in the market that have taken the spotlight from increasing inflation, to the rise in Covid-19 worries as the delta variant spreads.

The stock market is currently in an extremely bullish mode fueled by a "bubble" inside the market that's unsustainable and unpredictably bullish. Like any bubble… The heights to which it will push stock prices are unpredictable. However, unlike most bubbles… It may be predictable. This is the third time that this specific type of bubble has developed since 2000.In each of the last two occurrences, there has been an identifiable tipping point at which this

The recent runup to new highs in both the S&P 500 and the Nasdaq 100 came to an abrupt halt this week, and our Risk Gauges flipped negative in short order. It is also important to note the selloff in the SPY is not overdone and has a lot more potential downside. Even more critically, IWM looks extremely vulnerable, which is testing a well-formed valid 6-month trendline that has helped keep the rally intact. If

Written by Forrest Crist-Ruiz Google recently joined the list of growing companies to postpone their back-to-work plans as the Covid-19 delta variant continues to spread. Along with Google, Apple has previously extended working from home for the same reason. With large companies postponing back to office mandates many other companies are giving their employees the option to continue to work from home. With that said, we are keeping an eye on companies related to the

Every four years a simple time frame defined by the date of the presidential election creates an Election Range in most markets, ETFs, sectors and individual stocks. This Election Range defines inflection points that enable you to anticipate when the market will trend higher or lower in a meaningful way. Anticipating which direction the market will move is simple, and very powerful for identifying big trend trades. Below you’ll find an instructional video explaining the

Both the S&P500 and the NASDAQ l00 continued their leadership by hitting new All-time highs while Grandpa Russell (IWM) continues to lag. Market Cap heavy FANG stocks are masking poor market internals and the Modern Family is showing lackluster relative performance. However, overall, good volume, record money inflows with positive price action is still the narrative…. Meanwhile, KRE (Regional Banks aka the Prodigal Son) had monster performance on Friday which could indicate that the recent

Written by Forrest Crist-Ruiz As the Covid-19 Delta variant spreads across the United States, the CDC continues to update its guidelines to mitigate further spread. Although we don’t know if there will be any nationwide lockdowns or reduced travel restrictions in the immediate future, it has become abundantly clear that Covid issues are not even close to over just yet. The global pandemic has been a leading cause of stress on the market and could

When a leading market sector sells off hard, traders should take note to avoid getting surprised by a broader market sell-off. Even better than simply noticing an important sector reversing, would be to be to anticipate the move in time to avoid it or profit from it.On Monday, the Semiconductor ETF (SMH), a recent market leader, was one of the hardest hit sectors in the market’s decline. In this post you’ll discover how you could

It is a very strange market… Small Caps (otherwise known around MarketGauge as Grandpa Russell) were down almost -1.34% for the week, bucking the new all-time highs in both the QQQ’s which was up + 2.6%, and the SPY which was plus 1.67%. Growth stocks continued leading the charge. What is interesting is that despite the stellar performance by the SPY and growth stocks, is that market internals barely budged. They remained neutral. This indicates