Power Snapshots

May 16, 2024

After the outage, we have one more blank day to work through and the Snapshot will be back whole.

The Triple Play daily chart saw potential breakaway gaps in $SPY and $QQQ as RSI moves up and away from 60 solidifying the RSI bull ranges. $SPY went on Nitrous today and $QQQ and $IWM are not far behind. $IWM is the only one not in new 52wk closing highs yet, but it’s working on it. All of this on higher volume the last two days as we negotiate the highs.

On the 65 minute view, the RSI for the $SPY and $QQQ are above 80 and overbought so we need to see if we can hold near the breakout levels on any pullback in the coming days. Some ebb and flow would be great, but not sure if we will see much or not before OpEx starts to wind down on Friday. Buyers are strong here, but OpEx volatility could have us dancing around into Friday to clear all the options premiums. This month is not historically a big expire, so maybe the buyers’ sway will stay intact, but we have two days left to battle it out.

Due to the sideways nature of this correction, many are moving back over the 200sma before clearing the 50sma which is fine, that just means most 50sma never crossed below the 200sma which also shows the longer term trend is still holding up under the hood.

Starting to see lots of sectors and Subsectors go on Nitrous. Progress…

Short term breadth continues to strengthen as we head into new high territory. Nothing to hate here, actually the MA measures show we have more room before getting too stretched if buyers want to push the envelope here after the breakouts.

Utilities are still getting bought in this stage of the move. This is different than we would expect, so we might need to watch and see if the sector is taking on a new personality now that AI is the rage and people start to extrapolate out the markets it will effect. Or, it could just be going up with the high tide. The next week should give a clue if markets can maintain these new highs. I would expect Utilities outperformance to recede with other defensives quickly if this was just normal correction positioning.

Lots of new highs on lots of time frame measures and it’s happened on the second day of rising volume after a drought during the early part of the rebound.

Nothing to see here. No, really, literally almost nothing, except some selling creeping in Energy the last few days as some inflation fears wane.

The Wrap up

It is hard to read the very first paragraph and not come away with good vibes about the markets. The Triple Play charts are hard to find fault in right now. That can change in an instant, well actually a few instants, but it can change quickly. We will be here when it does. For now, buyers are showing complete control, even on small opening gap downs and intraday dips. Even with this action, I think there is enough disbelief out there right now that this can continue until that disbelief turns into FOMO. A breakaway gap is the definition of buyer strength, but only if it holds the next few days.

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As always, I hope this helps!