Market Update Into 10/8: A Recap After a Rough Week

A prepared trader is a profitable trader, and Sunday is a great day to get ready for the week ahead by studying up from last week’s price action. This weekend, we are focusing on the absolute bloodbath that occurred in the broad markets and will recap how last weekend’s charts performed. This analysis proves looking at multiple time frames is crucial as the daily and weekly candles were showing two separate things. The longer-term, bearish setup ended up winning over last week.

New Feature Alert: Trend Alert Sensitivity

Be sure to check our brand new “sensitivity” feature this week that allows to you increase or decrease the width of your alert to allow for some margin of error in case the price only misses by a few cents. See what we mean by checking out our blog post, Add Some Cushion to Your Alerts.

$SPY: Daily Chart

Last Sunday’s Chart & Analysis

This Week’s Chart & Analysis (October 5th Close)

1.  The $SPY initially bounced up on Monday which fulfilled the oversold conditions but then broke down through the support trendline.
2.  The price pierced the EMA (50) and then bounced to close above it.
3.  The daily Williams %R found resistance at the weekly Williams %R (dotted line).
4. The daily RSI started to break down through the weekly RSI but is now very oversold with the %R which may point to at least a dead cat bounce next week.

$SPY: Weekly Chart

Last Sunday’s Chart & Analysis

This Week’s Chart & Analysis (October 5th Close)

• The weekly chart ended up materializing here from last week’s analysis with negative divergence holding up and the MACD crossing to the downside. The RSI and Williams % R both have room to move down still towards the SMA (20) and channel support below.

$QQQ: Daily Chart

Last Sunday’s Chart & Analysis

This Week’s Chart & Analysis (October 5th Close)

1.  The negative divergence materialized on the daily chart with price breaking through both moving averages below.
2.  Selling volume increased dramatically in the last two days of the week.
3.  The Williams % R is oversold here which has proved to be a bouncing point in the past.
4. The RSI is also oversold with the Williams %R which shows the market may have some type of dead cat bounce next week.
5. Negative divergence materialized on the MACD as well with a bearish cross at the end of the week.

$QQQ: Weekly Chart

Last Sunday’s Chart & Analysis

This Week’s Chart & Analysis (October 5th Close)

• The price dropped down to test the SMA (20) support below as volume increased significantly over the prior week. If the SMA (20) breaks, watch for a further pullback to the price channel support below which coincides almost perfectly with the EMA (50).

$XBI: Daily Chart

Last Sunday’s Chart & Analysis (September 28th Close)

This Week’s Chart & Analysis (October 5th Close)

1.  The ascending wedge support that we were watching to hold last week ended up breaking down as well as the SMA (20) breaking down through the EMA (50).
2. After using manual tuning, this next support line was found and price bounced right off of it.
3.  The Williams % R remains oversold with the RSI.
4. The MACD is accelerating down after crossing last week.

$XBI: Weekly Chart

Last Sunday’s Chart & Analysis

This Week’s Chart & Analysis (October 5th Close)

• After a very strong move down last week, the price bounced slightly off the ascending wedge support and right below the EMA (50).

Timestamps of the Week

$OGEN

$INO

$CRMD