Small Cap King
StatsedgeTrading
Market Analysis
Bitcoin
Starting with Bitcoin, we had an interesting week. Last week, we highlighted a crucial low that has held up well. We saw a massive surge over the weekend, followed by some sideways action, and another breakout today. This undercut and rally pattern is bullish, likely causing short-covering and FOMO rallies. Ethereum also looks good, never undercutting its previous low, although it’s slightly weaker on the pop compared to Bitcoin.
Solana
Solana shows strong relative strength, never breaking its significant support zone and currently breaking out of its anchored VWAP. It looks promising, especially on a short-term basis, though a pullback or consolidation would be ideal for a buying opportunity.
Commodities
Gold and Silver
Gold had a volatile week. We saw a strong push but failed to hold above key levels, leading to cutting all gold and silver exposure. Silver, in particular, showed relative weakness and fell apart after initial strength.
U.S. Dollar (DXY)
The U.S. Dollar Index continued its downward trend, breaking several key levels. We had an inside week, and it wouldn’t be surprising to see some sideways action before any potential push higher.
Japanese Yen (JPY)
The Japanese Yen, influenced by the Bank of Japan’s interventions, is holding steady at significant levels. Watching the anchored VWAP closely for any breakdowns, which could present a trading opportunity
.
Equities and ETFs
SPY (S&P 500)
The S&P 500 showed a bearish engulfing candle at highs, indicating potential short-term weakness. However, a pullback into key support zones would be healthy and not a cause for panic.
RSP (Equal-Weighted S&P 500) and IWM (Russell 2000)
Both the RSP and IWM showed relative strength compared to the SPY, indicating a rotation out of big tech into other sectors. This suggests a broader market participation, which is generally positive.
Sector Highlights
KRE (Regional Bank ETF)
Regional banks look strong, with the KRE showing a solid performance even relative to the strong IWM
.
XLF (Financials)
Large banks are also performing well, suggesting strength in the financial sector.
HACK (Cybersecurity ETF)
Despite a significant drop in CrowdStrike, the HACK ETF held up well. Watching for potential recovery and continuation of the long-term cup and handle pattern
Conclusion
This week’s theme is market rotation. Big tech may be seeing some profit-taking, but the broader market is holding up well. Focus on sectors showing strength, such as financials and regional banks, and keep an eye on cybersecurity for potential recovery.
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