Stock Watchlist 25 March 2021

Good morning ladies and gents. Yesterday we saw follow through of Turnaround Tuesday’s bearish engulfing candles with sell pressure on the index’s, and as a result on most underlying stocks. As of this writing, 830AM, we’re currently seeing a gap down across the index’s and most stocks. As someone who is swinging a put/short position overnight, I PREFER to see a slight ‘gap up‘ (where stocks open slightly higher than previous close) that gets sold off, versus a ‘gap down‘ that *may* get bought up/bounce. That being said, I’ll be locking in profits at/near open on my TSLA put swing, and watching action.

In yesterday’s watchlist: https://infocusinvesting.com/stock-watchlist-24-march-2021/ I noted to watch the QQQ gap below, which filled within one trading session. The Q’s took a (-1.69%) hit on the day, and as a result, tech stocks continued it’s downside. I also linked some of the ETF information and what stocks actually comprise these index’s QQQ/SPY/IWM which we follow religiously (highly recommend to check these links out).

TSLA had a hard rejection of the 650 area and broke Tuesday’s lows of 657.51, which I mentioned was important for bulls to hold. It wasn’t much of a surprise though as we noted RSI was below 44.59 and BEARISH. It closed (-4.82%) lower on the day.

I also mentioned the IWM had a bunch of put flow at 208 strike with 5/21 expiration. IWM took a (-2.31%) hit on the day and closed at 212. As of this writing approx 8AM, IWM is under 210 in pre-market trading. Those $208 Puts didn’t lie huh?

SPY held up “the best” yet still posted negative on the day (-.51%). We’re currently seeing a weakening of SPY as well, with IWM/QQQ adding the downside pressure. The reason we are focused heavily on the index’s is because if you understand the overall trend of the market, it will help you trade the direction of underlying stocks. Now that we recapped yesterday’s action, let’s get into the charts and key levels.

Key levels to watch and set alerts on for QQQ:

$318.67 – Wednesday’s high of day (has a long way to get back to this level – most unlikely) -> above opens up 321.09 / 323.85 / 324.40

$311.87 – Wednesday’s low of day -> below opens up 309.66 / 306.92 / 304.10 / then psychological $300 level where we see some support from early March 3/04-3/08

NOTE: RSI is at 45.52 = BEARISH signal. There’s also a possibility of the 21EMA crossing down under 55EMA. Anytime you see a shorter term (8/21) crossing under a longer term (55/100/200) moving average, it’s a bearish signal. As a bull, you want the shorter term moving averages above the longer term ones, in order – 8 / 21 / 55 / 100 / 200, etc.

TSLA – as noted yesterday, RSI at 44.59 is bearish, under Ichimoku cloud is also bearish. The (8EMA) being below the (21) and (55EMA) adds to the downside pressure. We’re currently gapping down to around 610-615 zone, which is below Friday’s 3/19/2021 low of 624.62. As noted above, I will be taking profits on an overnight swing and then monitoring the action for potential scalps. I don’t feel comfortable doing much swing trading in this environment.

Key levels to watch and set alerts on TSLA:

$624.62 – Friday 3/19/2021 low, which we are currently below in pre-market trading -> below this opens up 604.44 (pre-market lows) -> below this, psychological 600 level / 595.21 / 575 / psychological 550

$640.29 – most recent pre-market 4hour candle high -> above opens up 652.67 / 657 / then $668.02 – Wednesday’s high of day (least likely we get there today)

IWM – the hardest hit of the 3 index’s yesterday. Currently gapping down along with rest of market. Interesting to see what it does in this area. Looks like it wants to retest the 100EMA at some point, which currently sits at 204.26.

Key levels to watch and set alerts on IWM:

212.04 – Wednesday’s low of day (currently BELOW in pre-market trading) -> above this opens up 216.03 / 219.86 (least likely to get up there today)

209.43 – below this opens up 207.21 which was March 5th, 2021’s low -> if it cracks below here, we’re looking at 205.76 / 204.84

NOTE: Yesterday we mentioned possibility of 8EMA crossing below 21EMA. Yesterday’s move now DID confirm this cross down which added to the sell pressure. As of now I’d not be calling any bottoms.

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