Will Santa be naughty or nice?
Updated: Dec 28, 2021
On Wed 22 Dec 2021 10.08pm, I emailed Clients my latest post titled 'Will Santa be naughty or nice?'
Pls find below some excerpts from my latest writeup. More importantly, I shared with my Clients which is my favored outcome out of the 3 potentials with regards to the recent S&P500 Index (SPX) price action:
S&P500 Index (SPX) Chart Daily, 7-mth
'.. In the last post, I mentioned the potential of an intermediate term bearish 'Broadening Pattern' manifesting in SPX. Given how the original unrelenting bullish price action has now morphed into a trading range (see attached SPX Chart yellow-colored zone), the potential of the said pattern has been..'
'..In the 1st reply (to client) on Friday 17/12 itself (see below whatsapp screenshots), I mentioned that I'm actually looking for SPX to break out & up given how the bullish inverse Head & Shoulders pattern is shaping up. However, in the same reply, I also mentioned I need a few more days to confirm the said bullish potential as price action has yet to break out.
In the 2nd reply on 20/12 Monday morning, I further mentioned that the 'alternative scenario will be price easing off towards early Dec lows (horizontal black line), thereby creating a big trading range'. Now, based on 21/12 Tuesday's night close, the alternative scenario appears to be playing out nicely as price action hits near the early Dec lows before staging a strong reversal. The 3rd & last possible scenario is that price action..'
'..The mega caps tech stocks (think FAANG) are still holding closer to their all time highs while many of the 2nd & 3rd tier tech stocks have seen extremely heavy drawdowns. Does it mean that these 2nd/3rd tier tech stocks are doomed forever? Perhaps not, I reckon once inflation numbers mean-revert sometime in 2022, there still stands a good chance for the 2nd/3rd tier stocks to recover well from the said lows. However, this likely only applies to those names that are able to consistently do a 'BBR'. 'BBR' stands for..'
To get the low-down on the full writeup, pls subscribe to my PATREON channel here: patreon.com/thom_ng
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Thank you & as usual, Live Long & Trade Well!
Thomas Ng, CMT
Principal Trading Representative
Chart source: tradingview
Image source: www.playbuzz.com/jackoneil10/are-you-on-santas-naughty-or-nice-list-this-year