2023-09-18M Uptrend Day 14 Uptrend under PRESSURE Holding TQQQ

September 18, 2023

2023-09-18M Uptrend Day 14  Uptrend under PRESSURE  Holding TQQQ                      

If you are interested in learning from Mark Minervini, the only 3-time WORLD TRADING CHAMPION, join Mark and some top IBD traders on Wednesday, 9/20/23 at  3:15 p.m. central time (links work in ALL time zones, just adjust for your time zone anywhere in the world). You must pre-register to get the link. Open the link to this very valuable workshop for beginners and experienced investors.

To register:

https://zoom.us/webinar/register/2216905679576/WN_TfLBFNAxRVujPMJ__4jnJw#/registration

I recommend jumping on the link early to ensure your seat.

REGISTER ON WWW.INVESTORS.COM      

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Also note that MarketSmith has made their excellent charting system FREE this week. Simply sign onto Investors.com and click on the MarketSmith link near the top of the page – FREE through Sunday night.

 

MONDAY,THIS WEEK, and YEAR-TO-DATE MARKET INFORMATION:

Be sure to read down to see how the TQQQ is holding up! The TRIPLE QQQ has returned EXTRAORDINARY RESULTS.

 

If you bought the TQQQ (triple QQQ) when it was discussed in this newsletter, you have made over a 3x return.  If you would like to lock in your current TQQQ gains, simply sell your position (or part of it) and enjoy the workshop.

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MONDAY:  The MAJOR INDEXES BARELY BREATHED ON MONDAY as the markets waited for the Federal Reserves next announcement on Wednesday afternoon.

All the indexes dropped below their 50-day moving average lines with higher volume from triple-witching options expirations event on Friday. The drops in price paired with the higher volume, created distribution days for the indexes.

The market remains up for this year but is showing significant uncertainty with the major indexes (Nasdaq, S&P500 and Dow Jones) all dropping below their moving average lines on Friday.

Note the volume is just average Monday with almost no price move (+0.01%) waiting for

the Federal Reserve’s FOMC (Federal Open Market Committee) interest rate announcement at 2 p.m. (NYC time)  on Wednesday.

We expect NO CHANGE in the Fed’s Funds Rate, keeping it at 5.25% to 5.5%..

Some of you sent me a question on “What could have caused the 75.6% increase om volume forthe Nasdaq and 90.0% volume rise for the S&P500?  

Answer:The market hit a triple-witching options expiration day which almost always generates a hug volume. The volume, simply, was extremely high to accommodate all the options that expire “in the money” and had to be executed to collect the gains!

>>>>Keep the shorting idea in your pocket. WE MAY WANT IT as we see how the market reacts to the Fed’s small (or no change) rate move.  

 

And note that the Nasdaq has been dancing on its 50-day (red) line. For me to short the QQQ (Nasdaq100), I would have to see the QQQ stay below its 50-day line with strong volume, showing serious distribution (selling.)

Yes, Friday did meet that criteria – but you have to ask what caused the HUGE rise in volume. And the answer is simple – The market. As long as I see a major index staying close to its 50-day line, and that line is rising (as it is now), I will consider staying in that index’s ETF such as the QQQ for the Nasdaq.

 

QUICK REVIEW OF THE Nasdaq’s  RECENT HISTORY

Let’s start our market analysis by stepping back to see what the Nasdaq has been doing over the last 6 years. What do you see in this weekly Nasdaq chart?

And we still have 3 ½ months to go in 2023. Please keep in touch with this newsletter.  Since the Nasdaq has given back 4.7% off that July high, I am watching the recent price action to see if the TQQQ will giveback something close to 3 times that much.

 

>>>I am great at reading the strength of the market as it happens, but I cannot predict its end of year closing price.  Hang out with me to get the daily “blow-by-blow” account.

 

Note: If the market starts to give up more of its 2023 gains, I could happily step out to cash and focus on planning a BIG year-end party!  After this amazing year, I am not interested in risking more of the gains.  I would rather just sit out the rest of the year (a whole quarter is still ahead of us) then watch these amazing gains whither away. Cash can be a relaxing place to sit and watch the action.  

 

Another question for those of you that like the S&P500…. When you can invest in the faster Nasdaq, “Why would you want to invest in the historically slower S&P500?”

 

And although the Nasdaq doesn’t outperform the S&P500 every day, it has over time, proven its significantly better returns.

The Major indexes wobble across the street with volume below the average for the last 7 days…. until Wednesday when the Nasdaq’s volume rose to 1% above average..

And just to remind you, the Triple QQQ (TQQQ) has outperformed them all with a 134% gain this year. But you must watch the TQQQ daily, because when the market drops, it will drop about 2 ½ x to 3x versus the QQQ.

>>>>> This year’s market has already paid me well and is holding near its year-and-a-half highs!.

 

The GOOD NEWS is that there were 90 rising days over the last 20 trading days but  only 6 falling days over the same period.

Do you pay attention to price AND volume?  

 

There were 4 distribution days (lower price with higher volume)  in the last 20 days but only 2 accumulation days (higher price and higher volume.). 

Yesterday’s minor accumulation day give us the second Accumulation day in the last 4 weeks.  

 

PLEASE WATCH THIS NEWSLETTER EVERY DAY.  This market could crash on little notice.  Or take off to a new highs!

 ON THE ACCUMULATION/DISTRIBUTION RATINGS TABLE BELOW……  

THE DOWNTURN OF THE ACCUMULATION RATINGS is a slight WARNING! Don’t worry – I will watch it for us and report back any “breaking news!”

Here is a confirmation of the current weakness in this Uptrend. The A & B rated stocks which had been climbing higher has dropped a frustrating 8% in one week from 46% to 38%.

IF YOU PURCHASE AN AGGRESSIVE POSITION LIKE THE TQQQ, YOU MUST KEEP YOUR EYE ON THE MARKET EVERY DAY. Even if it is just a quick read of the front of the ARMCHAIR INVESTOR newsletter.

One additional “Word to the Wise”…

>>>>>--- MOST MARKETS FALL FASTER THAN THEY RISE! So please, read this newsletter (at least the first section) DAILY!

Please send questions, comments, suggestions ideas and requests to:   My text message account at (214) 995-6702.

Wishing you, “Many Happy Returns.”

Charlotte  Hudgin, The Armchair Investor,                                              

www.ArmchairInvestor.com   (214)995-6702   

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