I knew last week was going to be tricky, so instead of trying to decide on a bullish or bearish bias for the market, I made both a bull case and a bear case. That was very helpful for my own clarity. Ultimately I decided that if I saw market strength, I would long $RTY/small caps futures and if I saw weakness, I would short $NQ/Nasdaq futures using my levels as guides. That worked out well given the market’s mixed performance this week. $RTY settled up +1.41% and $NQ down -.98%.✅💰
My weekly levels also performed well. Here is how my weekly $ES/SPX futures levels performed on the hourly chart this week:
I gave 1953.9 as the $GC/gold futures bull/bear key for the week. The low of the week was 1949.✅ I wrote that it was decision time over 1973.3, but gold retracted underneath on Friday to close ambiguously just in time for FOMC week. 😏
I pointed out that $XOP/oil stocks looked like a false breakout to me (normally I would be all over it), BUT because it can be ‘twitchy’ I said I would exercise caution with oil shorts if I took any while still above my level. I didn’t trade it last week.
Summary of Market Action Last Week:
The indices rose through Wednesday, but then declined on Thursday and Friday to close mixed. $RTY saw the biggest gain week over week once again, but $NQ closed in the red.
$GDX/gold miners and $SI/silver futures pulled back from the previous week’s outperformance and gold closed essentially flat.
$CL/Crude Oil futures continued the break out and $XOP/oil equities reversed course to erase last week’s loss.
Here’s how last week closed out:
For the week ahead (7/24-7/28/23)