Weekly Wisdom: NVDA Fails To Overly Impress

Greetings fellow traders and welcome to your November 21st edition of Weekly Wisdom: Levels to Know and Moves to Look For!

Now let’s get to what we’re currently seeing in these volatile markets and what we have our focus on going forward.

Taking a look back on this week, November 18 – November 22:

• Markets have again stalled out sideways this week following last Friday’s sell bar lower where $SPX futures broke down through the 5950 momentum support bulls had been looking to hold.
• Bears that ended up going short against the 6025 level highlighted last week enjoyed a nice breakdown last Thursday and Friday.
• $SPX futures proceeded to find a range this week ahead of $NVDA earnings within last Friday’s breakdown candle, roughly between 5880 – 5950.
• $NVDA reported earnings on Wednesday after the close and while the numbers were good, the report was not necessarily a “spectacular” report, which led to $NVDA failing over the 150 breakout level.
• Data for the week began on Monday with a beat for the NAHB Housing Market Index at 46 vs 42 expected.
• Tuesday brought updates for building permits which were roughly inline at 1.42 million vs 1.44 million expected; housing starts was a miss at 1.31 million vs 1.34 million expected.
• Thursday gave a beat for weekly unemployment claims at 213,000 vs 220,000 expected. The Philly Fed Manufacturing Index was a miss at -5.5 vs 7.4 expected. Later in the morning, we saw existing home sales come in line at 3.96 million, while the CB Leading Index m/m was a slight miss at -0.4% vs -0.3% expected.
• Friday, November 22 ends the week with flash manufacturing PMI and flash services PMI at 9:45 a.m. ET. The final data for the week gives us revised University of Michigan consumer sentiment and inflation expectations at 10:00 a.m. ET.

Here’s what we are eyeing next week, November 25 – November 29:

Level Highlights:

• $SPX futures spent the week ranging out roughly within last Friday’s sell candle between 5880 and 5950 with a few tails outside of the range.
• $NVDA earnings did not overly excite or disappoint traders after Wednesday, failing to push $SPX out of the range which we continued to see trade on Thursday following the report.
• Overall while $SPX futures lost momentum support, the bigger picture still holds in with the post election support level of 5820 holding for now – that is a big level where bulls do not want to see a close below in the coming weeks.
• We remain in one of the most seasonal strong parts of the year, which continues to help give an extra push for the bulls.
• Next week is a shortened and typically slower week with markets closed on Thursday for Thanksgiving and open for a half day on Friday, with equity markets closing at 1:00 p.m. ET on Friday.
• Many traders still like to be at the desk for the first half of their Friday as markets are typically very thinly traded. 

Upcoming News:

• Monday, November 25 starts the shortened week off with no meaningful data being reported.
• Tuesday, November 26 brings data updates for CB consumer confidence, new home sales, and the Richmond Manufacturing Index all at 10:00 a.m. ET.
• Wednesday, November 27 is a busy data day with markets and banks closed on Thursday for Thanksgiving. Data for the day kicks off with weekly unemployment claims, prelim GDP q/q, durable goods orders m/m, core durable goods orders m/m, prelim GDP price index q/q, the goods trade balance, and prelim wholesale inventories m/m all at 8:30 a.m. ET. These are followed by PCE and core PCE price index m/m, pending home sales m/m, personal spending m/m, and personal income m/m all at 10:00 a.m. ET. Later in the afternoon, FOMC meeting minutes are posted at 2:00 p.m. ET. There is no interest rate decision or press conference from this meeting.
• Thursday, November 28 markets and banks are closed for Thanksgiving. Gobble gobble!
• Friday, November 29 is a half day for markets following the Thursday closure for Thanksgiving, with equity markets closing at 1:00 p.m. ET. We will see the update for Chicago PMI be released at 9:45 a.m. ET.

Here’s Your Chart of the Week:

Via Bloomberg, Morgan Stanley Research: With many traders viewing the Trump presidency as good for growth but also potentially inflationary, many are focusing back on inflation numbers for any signs of upticks.

Source

SPY Daily Update:

$SPY daily chart testing the top of the range resistance on Thursday after we broke down through momentum support last Friday but have yet to see further follow through lower. $SPY held 586 support throughout the week and are now attempting to get and close back over 592 resistance.

SPY Weekly Update:

$SPY weekly chart building an inside week after cooling off last week but holding Friday’s low this week. Overall, despite dampening of momentum that took place, the bigger picture remains bullish and in tact for now.

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-Patrick Hawe

Disclosures

Patrick Hawe’s current positions:

*As of 1:58pm ET November 21, 2024

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