Daily Plan 9.26.23
Dead Cat Bounce.
Hey folks -
Primary technical thesis this week has been that the bears need to take down the levels I described last night in the Weekly Plan to get downside momentum going.
This was not to be the case today as we tested these levels and then rallied about 1% higher to close the session into 4380.
For tomorrow, the CB Consumer confidence is a key event which if comes in stronger than expected could fuel strong dollar bets and could lead to higher yields. Yields are already bursting at the seams and I think this market will begin throwing tantrums soon if we continue to drill down below 90 in TLT.
The CB consumer confidence comes about half an hour into the cash session and could define rest of the session, may be even rest of the week.
Consumer confidence, against odds, has held up in recent months and I will be very surprised if we see a large haircut in this number tomorrow.
My levels for tomorrow
My key level tomorrow will be 4372.
Scenario 1: I will like to be bearish biased below 4372, to target 4330.
Scenario 2: Unless we take out 4372, we may target 4392-4395 resistance levels.
At time of this post we last traded 4380.
Overall, I am keeping eyes on TLT. This thing is turning disturbing. I think TLT if it does not take back 90 could lead to some unpleasant side effects - this is just a proxy for longer term US bonds and treasuries. There is no large institution worth its salt, either in the US or elsewhere globally that does not has some level of exposure to these instruments and they are down massively. Again, it is the bonds we are talking about. This is the largest market by notional dollar globally. However, when you look at the TBT chart (inverse TLT), it looks like that of some small cap meme stock. Relentless money printing has turned the US bonds into meme stocks it seems!
In some other names that I shared last night, we saw 10% collapse in the Vietnamese auto maker. We saw another 5% drop in the used car seller.
This is the good thing about volatility- we do see large and decent moves on both up and downside once the volatility train leaves the station.
I plan to share a lot of such names soon. Do not be left out of the vol train. Like, share and subscribe to receive more levels, chats and updates overall. No one likes to work in a vacuum and this is why I ask that you are an active participant rather than passive wall st flowers.
~ Toc
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