Daily Market News - 26th Oct 2021

Is The Market Breaking Out?

What can I say.

October’s pretty much gone to plan so far, hopefully you’ve done well and not been caught out shorting stocks in a rampant bull market.

On the 29th September, I highlighted the bullish seasonality coming into Q4 and this looks to have started out well.

It’s worth mentioning the market crashed spectacularly 18 months ago, added to that, we’ve also had a massive stealth correction already this year where most stocks declined in excess of 20% while the S&P500 was making new highs, so I really don’t see what the fuss is about.

Could we collapse spectacularly? Sure. Anything is possible. Charts keep me on top of the changes so I’ll let the perma bears shout from the rooftops, I’ll just keep my focus on my charts.

Throughout October I’ve been providing lots of actionable charts and I have a few key chart updates today that should give a bit more perspective on what’s going on.

Lets start with Financials

If you didn’t know, Financials are breaking out. Something I’ve been on top of for the last few weeks… some BIG moves are taking place in the less glamorous areas of the market just now and this is another chart that screams Risk On to me. If Financials are front and centre in a rising rate environment, we probably want to be long the boring old Financials.

Crude Oil

The break out went to plan and It’s +10% from the levels I highlighted on the 29th September, and I don’t see any reason why we can’t see $100 a barrel in the not too distant future. If we see a pull back, the $76 level would need to hold as support for my bullish thesis to remain intact, below $76, all bets are off.

Ethereum

It’s only a matter of time before Pension funds and every money manager on the planet is forced to allocate to cryptocurrency… if you have a money manager and they’ve learned the trade 10,20,30,40, 50+ years ago and they’re stuck in the past, I’d suggest this serves nobody particularly well.

Ethereum is +46% from my bullish call on the 1st October and now testing former ATH’s. $4400 is a Key Level for my work.

The NASDAQ Composite (COMPX)

The beginning of October was a little tricky, on the 5th October, I highlighted the bottom in the Nasdaq and this has played out well, we’re now looking like we’re testing previous ATH’s and technically range bound.

What happens on a test of ATH’s?

I’ll let the market figure that 1 out.

The Midcaps (MDY)

The midcaps breaking out isn’t a bearish development for the market, and while I’m sure many of you only buy Mega Cap Tech or keep going back to the same stocks time and again, I can assure you, some of the fastest moving names are being found in the $2B-$10B Market Cap Range.

Our Premium Weekend Analysis went out to members on Saturday with charts for individual names that are setting up nicely. A lot of those moved 5-10% yesterday.

If you enjoyed the read, feel free to subscribe to our free content, or check out our various membership options by clicking the button below.