4/5/22

STOCKS – SHOP, AMZN, SQ, NVDA

MACRO – SPY, QQQ, TIP

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• RTM: Closing Out Tesla [TMG Update]
• RTM Tactical Update: All Eyes On The Balance Sheet Reduction
• RTM: Reversal May Be In Place

The S&P 500 fell by roughly 1.25%, while the NASDAQ finished down over 2%. Today’s drop quickly erased yesterday’s advance. The pattern in the QQQ ETF worked out quite nicely, with the ETF returning to the origin of the move higher.

The whole drop started when a usually dovish member of the FOMC sounded very hawkish. That doesn’t bode well for tomorrow when the minutes are released.

From a technical sense, there is something much worse at play here, which is a rising broadening wedge. The QQQ closed just a touch below the bottom trend line, not enough to convince me the pattern has broken down. If it does break down, which I expect to happen, nearly all of the gains from the middle of March will be gone.

S&P 500 (SPY)

The same pattern is present in the S&P 500.

TIP (TIP)

The TIP ETF keeps dropping, and it isn’t even oversold yet. Meanwhile, the gap between the TIP and QQQ keeps growing wider. Just watch the TIP ETF.

The relationship is powerful between the TIP ETF and Amazon. So I’d be rethinking my thesis if you are someone looking for Amazon to go higher from.

Dollar (DXY)

If there wasn’t enough going on, the dollar index broke out today, rising above resistance around 99.40; the next stop is over 100. I know that is not much of a call, but it is crucial.

Amazon (AMZN)

By the way, I forgot to mention that there is a head and shoulder pattern on the Amazon hourly chart.

Shopify (SHOP)

Shopify has the same pattern.

Nvidia (NVDA)

Nvidia has the Head And Shoulders pattern too.

Square (SQ)

Square too

Have a good one.

Mike