Weekly Reversal Portfolio

[Image] Good morning , Welcome to a free week of Real Life Trading Newsletter. We hope you had a wonderful Christmas and enjoyed the extra-long weekend. On this second day of Christmas, we won’t be giving you any doves, hens, geese, partridges or any variety of bird for that matter. Instead we have our usual market analysis and Weekly Reversal trade. The SPY, QQQ and DIA continue to press higher and just completed their eighth bullish week in a row. This is an impressive feat, although not as uncommon as one might think. The QQQ seems to pull it off about once a year, and this is the second time it has done it in 2023. Bears should note that it took another 6 weeks before a true correction started the last time. In order to find the last time all three indices were bullish for 8 weeks straight, we need to go back to January 2019. SPY [Image]( One very interesting correlation between now and January 2019 is the behavior of the Federal Reserve. In 2018 a hawkish Fed hiked rates 4 times, which culminated with a precipitous 20% drop into Christmas Day 2018. The Fed was planning on at least 3 more rate hikes in 2019, but the market saw a classic Powell Pivot in January 2019 and the first rate cut came soon after in July of 2019. The 2019 Fed, led by the one and only Jerome ‘Pivot’ Powell, got it all wrong and pivoted to the cheers of market participants. Interestingly enough they actually admitted they were wrong in 2018. This time around they just throw phrases like ‘transitory inflation’ and ‘higher for longer’ down the memory hole and hope no one notices. In J. P. Powell’s defense, it’s an impossible job for anyone to do. Maybe our A.I. overloads will do a better job. So, what happened after the eight bullish weeks in 2019? The market paused for a few weeks and then rocketed higher into new all-time highs before a real pullback finally appeared. That larger pullback was a buyable dip as it bounced very quickly to new all-time highs just 3 weeks after the low. All of that to say, it looks whenever a real dip shows up, it will likely be a buyable event at least on a shorter-term time scale. As long as the October 2023 low holds and the soft-landing data keeps on rolling in, the bullish trend is your friend. SPY 2019 [Image]( [Image] The Weekly Reversal Portfolio had a great week as both [RAMP]( and [VRRM]( hit their targets. After exiting those two, there are only three open trades and two have stops above break even. We cancelled [OWL]( as it ran without us. However, it could be one to keep an eye on as it could still make for a great trade if it does retest back down into that area over the next few months.[ALV]( is closing in on Target 2 and will hit this week with any bullish follow through. [PHR]( has retested and if it can close above Wednesday’s candle, the stop will get trailed and it will be a big winner for the portfolio. [USAC]( missed its target by 32 pennies on Thursday and has been selling off ever since. It formed a pretty strong evening star reversal pattern over the last 3 days and looks like it is headed lower. If the 100DSMA can hold, it may be alright, but if not, looks like the target was just a few pennies to high and it will end up being a small loss. ALV [Image]( [Image] The Weekly Reversal this week is Steelcase Inc (SCS). SCS had earnings on Wednesday which went seriously red to green. This is the exact thing we are looking for when we scan for weekly reversals and SCS did it in a matter of hours on Wednesday morning. The bears were extremely trapped which led to it squeezing higher all day long. Since it was such an enormous candle, and the market is due for some kind of rest and retesting, we are looking to buy the retest of the earnings candle. Often times very, very strong candles will only retest down into the .236 range before moving higher, which SCS has already done. We saw this exact thing with OWL last week and it could happen again. We will stay on the more conservative side of things and see if it can get close to the 50% retest level for optimal risk vs reward. If the trade runs without us, that is ok, there will always be another. The System is buying SCS with a limit buy at $13.28 and a stop at $11.70. Target 1 for 50% of the position is at $14.54. SCS [Image]( [Image](mailto:support@thetradersplan.com) Disclosure: You are responsible for your own trading decisions. ALWAYS, do your own research before investing in any of the above securities. This is not a solicitation to buy/sell ETFs or securities. NEVER invest money in ETFs or stocks that you can't afford to lose. You can lose all of your capital by trading any securities mentioned. These ETFs/securities are very volatile and gain and lose value quickly. We reserve the right to freely trade in any mentioned ETFs or securities. We are not compensated by any mentioned companies. We trade ETFs and securities based on our opinion of intrinsic/possible future value only. We are not registered investment advisors, so always do your own research before buying any securities. Unable to view? Read it [online]( If you no longer wish to receive mail from us, you can [unsubscribe]( Sent from: Real Life Trading in Nashville TN 37221