Market Outlook
The market felt like it was starting to form a breakdown stage but after the market held the 740 pivot low on Wednesday, we ended the week on a nice 3 day run up. As we are a mere 5 points away from retesting ATHs, its not much of a bold claim to say that should happen early next week.
But as we know, the first retest of an ATH is often met with resistance, sure it may push a few points through the level but that area tends to be held down for the time being. As the market continues to trade in this range bound market, selling into resistance and buying into support continues to be the move.
Bio Techs and Healthcare saw some profit taking at the end of the week but after the run they have been on since June, it should not come as much of a shock after 20+ green days in a row.
Semi's, Tech and the Nasdaq names continue to put up a fight as they try to hold onto this rally with all they have.
By mid week, we were seeing some nasty gap down's in the Semi's as the top seemed to have already been put in. But instead of an elevator down type of move, we are seeing more of a topping pattern or broader bull flag forming at highs. In this shift from the easy breakout stage from April to June, now is when it gets choppy and annoying holding names in this sector as the day to day action can be confusing. One day its game over, the next day, the game is back on.
If you are in a Semi name and caught a major win in it, once you get stopped out, move on from the name for at least a month. All too often, after selling a winner or getting stopped out just at the low, we feel the need to get back into the name to get our lick back, but more often than not, that next trade undoes all the good the winning trade did.
Now there still is some juice to squeeze in the Semi sector as the sector seems to be in its final inning. AMD is setting up while NVDA gave us a tight risk entry this week.
As much as the sector seems to be cooling, there often can still be one last push and this AMD is giving a tight risk set up, where we would want to see 560 break and never look back. As we saw with NVDA as it broke 200 and climbed $11 in a snap.
So there is still some juice to squeeze in the Semi's but we have to proceed with caution and only hold if the names are pushing higher. This is not the time you want to be in a Semi that is consolidating.
My focus continues to be on the healthcare and bio names as there are a handful of textbook bull flags forming like WST and XMTR with much less of a crowd focused on them.
Continue to call out your top ideas in the chat and I hope you all are able to grab a new copy of the Dumb Money book coming out in 2 weeks. I've spent the last year painstakingly compiling the most important lessons and mistakes I've learned over the past 20 years in the market. Putting together all of the key lessons and mistakes to avoid from those experiences into this book. With 400 pages of new chapters, it will keep you entertained as an educational summer read. Pre Orders for Kindle are live while the soft and hard cover pre orders will be available in the coming day's once Amazon approves them.
My goal, if you would like to help me exceed is to have 100 reviews for this book by end of year. As always I have some surprises for the members who support the book, as we have always done with our previous books over the years.
From Bennett
Founder Big Picture Trading
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It's crazy how time flies, it has been a year since Big Picture Trading has opened and during this past year I have taken all of the most important lessons and mistakes that I have learned over the last 20 years of trading and investing and put them into Dumb Money.
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Macro Rotation
SPY
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Sector Rotation
Sensitive - sectors that have moderate correlations to overall market conditions.
Tech
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