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00:00:00Hello, everyone. It's Stephen Whiteside here from the
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00:00:03uptrend.com with this weekend's edition of Stock Market Timing Television.
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00:00:07Well, it's Sunday evening.
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00:00:09Stock Index futures are trading.
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00:00:10They're down slightly.
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00:00:12This is a long weekend
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00:00:13on both sides of the border, but it isn't one of those long weekends where we get
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00:00:18overly bullish going into the three day weekend.
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00:00:21It's just not that type of weekend.
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00:00:24Let's start off looking at the VIX.
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00:00:25The VIX ended down just under 2.5% on the week.
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00:00:31Things would change dramatically for the
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00:00:32market if the VIX were to close above 22.73 this coming Friday.
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00:00:36Now looking at a daily chart of the VIX
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00:00:39coming into Tuesday's trading action, we're still on a sell signal here.
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00:00:43We're really stuck in a range.
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00:00:45We made a low a couple of weeks ago down there at 17.06, and we're using 21.88
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00:00:52as resistance and looking for a breakout above 21.88 or a breakdown below 1706.
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00:00:59That would probably
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00:01:00give us a better indication of which way the market wants to go next.
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00:01:04Now, during the week, we looked at this chart.
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00:01:06It's a seasonality chart of the VIX.
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00:01:08Notice where we are right now, which is just in the third week of February.
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00:01:14From that point on,
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00:01:17historically, there's a seasonal tendency to rise dramatically into March.
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00:01:22Now, that's not a guarantee, and knowing this information
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00:01:25is not going to make me do anything different at the moment.
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00:01:30It's just allowing me to anticipate that we could see a big move down into
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00:01:36March for the stock market and a big move up for the VIX into March.
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00:01:41That's seasonally what could happen.
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00:01:43Let me tell you about seasonalities.
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00:01:45Right now, it is the third week in February and outside there is no snow.
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00:01:51So seasonally there should be snow out there, but there isn't.
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00:01:54So the seasonal tendencies do not guarantee anything.
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00:01:58They just make us aware of what may happen in the future and get us mentally prepared
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00:02:04to take action based on that seasonal tendency.
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00:02:08Seasonal tendencies don't cause you to do anything.
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00:02:10They just cause you to anticipate that something could happen.
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00:02:15Now, we've been talking about major
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00:02:16resistance for weeks now, and that has not changed.
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00:02:19The DAO has not been able to make a higher high in a couple of months and still
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00:02:23looking for a close breakout really above resistance at 34, 375.
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00:02:29Similar situation for the Nasdaq 100.
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00:02:31We drove up to the 12,500 level and we've basically stopped there.
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00:02:37We're looking for the Russell 2000 to break out above 2000.
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00:02:41Three weeks ago, we put in a lower high than the high from last summer.
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00:02:45Then looking at US microcap stocks, that's also true.
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00:02:49Three weeks ago, we put in a lower high
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00:02:52looking for the iShares microcap ETF to make it up to 125.
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00:02:56It hasn't been able to do that so far.
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00:03:00So waiting to see how that works itself out.
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00:03:03Looking at us, 31.25 is still our big line in the sand.
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00:03:08That has not changed.
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00:03:10I noticed for the last three weeks, we've
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00:03:11been able to trade up to that level and reverse from it.
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00:03:15A lot of resistance up there at 3,125.
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00:03:18Then looking at US banks, I've been watching this ETF for weeks, seeing if we
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00:03:23could break out above 50, and we have not been able to do so.
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00:03:26We've been able to trade above it, but at
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00:03:28the end, we really haven't been able to break away from the $50 level.
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00:03:33Looking at the Canadian
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00:03:34market, there's the TSX 60 dealing with 1250 and has not been able to do so.
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00:03:41We drove up there a few weeks ago and been
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00:03:43waiting to see if we could break out above that level.
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00:03:46But we haven't seen a lot of positive movement in crude oil or natural gas.
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00:03:50Natural gas making a new low this week.
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00:03:52And of course, we've seen the precious metals pull back.
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00:03:55So that could hold the Canadian market in check.
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00:03:58Looking at Canadian small caps, they did
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00:04:00drive up to 750 a few weeks ago and then have pulled back.
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00:04:04And then looking at the venture exchange, you can see a few weeks ago we
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00:04:07drove up to 625 and basically we've been treading water ever since.
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00:04:12Looking at the weekly right side charts, you can see the S&P 500
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00:04:17pulled back slightly on the week, just down a little over a quarter of a %.
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00:04:22Still trading and closing above the upper channel line.
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00:04:25Remember, above the upper channel line is bullish, in the channel is neutral, and
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00:04:29then, of course, below the lower channel line is bearish.
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00:04:33Now, notice the S&P 500.
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00:04:35Three weeks ago, we traded up to the
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00:04:36bottom of that open gap from back in August, and that's where the market was
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00:04:41held in check, and we've pulled back from that point ever since.
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00:04:46The bottom of that open gap could, of course,
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00:04:48act as resistance if we start moving up once again.
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00:04:51Then, of course, the top of that open gap,
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00:04:53which isn't too much higher than the bottom of the open gap, could
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00:04:59also act as a magnet and as an area of resistance.
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00:05:04Inside week for the Nasdaq, the Nasdaq closed up just under half a % on the week.
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00:05:09Inside week for the Russell 2000 did a lot better, up 1.44 % on the week.
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00:05:14Then we saw the TSX pull back just under
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00:05:16half a %, still trading above the upper channel line.
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00:05:20And some things that aren't necessarily
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00:05:22good for the stock market, we saw the bonds continue to trade lower.
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00:05:27Of course, that's putting upward pressure
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00:05:28on bond yields, and that's not necessarily good for the stock market.
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00:05:33And then the US dollar index, after trading up to the upper channel line, it
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00:05:37settled down, still closing up 0.22 % on the week.
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00:05:42So no trend change there.
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00:05:43We've been in the channel for the last two weeks, but of course, a rising US dollar
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00:05:48may not be good for the stock market at this particular time.
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00:05:52Now, crude oil ended the week down 3.27
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00:05:55% still in the channel, so no change in trend there.
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00:05:58We are looking at natural gas, possibly putting in a bottom last week.
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00:06:02That turned out to not work out that way
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00:06:05with natural gas down another 11.16 % on the week, making a new low for this move.
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00:06:11Then looking at copper, copper recovered this week, closing above
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00:06:14the upper channel line while gold was down $25.10 on the week.
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00:06:19Still on a weekly buy signal here, closing in the channel.
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00:06:22That would change on Friday with a close
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00:06:24below 1849.87. And then there's silver continuing to move lower.
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00:06:29Actually, gold was down in percentage terms just a bit more than silver on the
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00:06:33week, but silver has been leading precious metals lower for the past few weeks.
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00:06:40Now, last week we talked about four stocks
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00:06:42to watch, and of course, these weren't recommendations.
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00:06:44What we are really looking at here is we want the leaders to lead.
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00:06:48If the market is going to continue to move
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00:06:50higher from here, then we want the leaders to show leadership.
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00:06:54And that's not really what's happening at the moment, unfortunately.
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00:06:58Apple was up a little over 1 % on the
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00:07:00week, did not take out the high from a couple of weeks ago.
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00:07:04You can see that we traded above the
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00:07:06156.25 level, which, of course, is a profit target for us.
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00:07:10We were able to sell some shares up at that level.
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00:07:13On Thursday, we took a run at those highs and then quickly reversed.
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00:07:17Now we're sitting trading still above 150.
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00:07:20We need to close on Tuesday below 150.12. If we get that on Tuesday, that,
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00:07:25of course, would generate a new sell signal.
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00:07:27Of course, we'd come in and screen that sell signal on Wednesday
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00:07:31morning to make sure the market did not reverse in our face overnight.
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00:07:36But if we do get that close of below
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00:07:38150.12 on Tuesday, we would be not only sellers of the small position that we
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00:07:43still have, but then we would go short Apple.
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00:07:46Now, I don't have a personal interest in the other three stocks.
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00:07:49Microsoft was doing really well over the past few weeks.
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00:07:53This week it had an inside week but was down nearly 2 %.
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00:07:58You probably remember a couple of weeks ago, everybody was cheering that Microsoft
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00:08:01started to break out above the 200 day moving average.
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00:08:04Well, it has completely reversed
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00:08:06and it is back down trying to find support at the 200 day moving average.
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00:08:11Now, our daily right side chart generated a sell signal on Friday.
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00:08:14So you come in Tuesday, you check the premarket action.
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00:08:17If the stock is not up dramatically in the
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00:08:20premarket, then you have a new sell signal.
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00:08:23And if you've been waiting to short
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00:08:24Microsoft, well, Tuesday morning might be the day to do it.
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00:08:28Now, unfortunately, Shopify was not the leader that I was hoping it would be.
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00:08:33I was hoping Shopify could continue to move up, but it
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00:08:36completely reversed this week, down nearly 9 %.
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00:08:39And again, people cheered when it started to trade through the 200 day moving
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00:08:43average, but that has completely evaporated.
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00:08:46And now we're trying to hold the 50 day
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00:08:47moving average with the 100 day moving average just below that level.
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00:08:51We had a little kerfuffle during the week because on Wednesday, people got a little
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00:08:56excited and Wednesday ended with a close above the upper channel line.
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00:09:00So the first close above the upper channel line is a buy signal.
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00:09:03But of course, you're going to take that order at the open the next day.
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00:09:07And before you place an order, you should
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00:09:09figure out what's going on with that particular stock.
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00:09:12And it was easy enough on Thursday morning.
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00:09:16Shopify was all over the news.
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00:09:18And so it's pretty easy to figure out that
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00:09:19Shopify was down, trading down 9, 10 % in the premarket.
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00:09:23So when you're up sharply one day and down
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00:09:26sharply the next morning, you're not going to take that buy signal.
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00:09:29You're going to walk away or continue to sit on your short position.
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00:09:34So if you're short Shopify, continue doing so.
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00:09:37You've got no reason to end that short position on Tuesday morning.
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00:09:42Last up, we had Tesla.
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00:09:43Tesla did make a new high this week.
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00:09:46It was trying to break out above two 1875.
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00:09:47We didn't get that high on the week.
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00:09:51We got as high as two 1,765.
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00:09:54Why did we stop there?
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00:09:55Well, that's where the 200 day moving average is.
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00:09:58And unlike what happened to Shopify and Microsoft, Tesla has not been able to
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00:10:02break out above that 200 day moving average just yet.
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00:10:06We had a bearish reversal day on Thursday, so that's the high for this move.
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00:10:11We saw a drop into the channel on Friday,
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00:10:13but we actually recovered and closed higher on the day.
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00:10:16So looking for a close on Tesla below
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00:10:19191.70 on Tuesday to give us a new sell signal.
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00:10:24Okay, folks, that's all for this weekend's presentation.
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00:10:26Not a lot fundamentally happened this week that we need to be concerned about.
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00:10:34If we made a new low in the VIX or if the
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00:10:36VIX broke out above 21.88, that would be a concern.
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00:10:40If some of those major indices that are being stuck at resistance, if
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00:10:43they had started to break out above resistance, that would be a good sign.
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00:10:48But so far, none of that has happened yet.
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00:10:50So we've got another week to go to see if anything major changes in the markets.
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00:10:56Enjoy the rest of your weekend.
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00:10:57Enjoy your Monday holiday.
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00:10:59Next time you'll hear my voice
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00:11:01is on Tuesday morning.