Markets Bounce On Micron Earnings But Inflation Threat Looming

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Hello everybody, welcome to trading the
close. My name is Drew Dosek and guys
today the story was really on two
things. Micron earnings results
obviously those came yesterday but then
the PCE core PCE data that came in it
was high but it wasn't a surprise to the
upside and that's why the markets
reacted the way they did they didn't
sell that hard even though it was a high
print it was within the range of
expectations but what that did was
basically solidify the Fed in hiking
rates in the near future percentage
points actually increase for the Fed to
hike rates in in July. We certainly are
almost guaranteed a hike in September.
Uh but at at this current state, we'll
be watching those numbers for July to
see what the report comes in for labor
at the beginning of next month. And then
other data points as well. We'll make
sure to keep you all attuned, but
basically that was why the markets
reacted the way they did. The micron
earnings really kept everything elevated
despite the first 30 minutes of selling
in that stock. Let's get into some
charts, folks. Starting off with the S&P
500. It ended up positive for the day up
0.14% but did put in another red candle
because we opened up higher and closed
lower within that candle. And to show
you the intraday price action it was
pretty violent. You can see right at the
open we were up here and then the first
three candles straight down then had a
monstrous bounce and then basically just
trickled off sideways for the remainder
of the day. Now you can see after hours
were already elevating back up. so hard
to keep these markets down in the face
of rate hikes. Um, and but you know,
with tech still leading the way, it's
really keeping everything elevated to
the upside. Still remains the same for
resistance. Notice how these three days
on the S&P 500 have remained underneath
this inclining trend line. One that I
pointed out about a week, week and a
half ago as basically the line in the
sand between bullish price action and
near-term bearish price action. So the
level for that tomorrow is at $740.31
obviously to break the top of this
parallel. And by the way, I did change
the parallels to keep everything a
little bit more transparent and easier
to see. Keeping your eyes locked in on
these major entryways and exits to these
trend lines as well as parallels.
Anyway, the level for support and to
breach into that parallel is right here
tomorrow at $72828.
into the cues. [snorts] As you can see
here, they also did put in a green day
up 81% but a big reversal in early price
action much like on the spiders. Look at
that. We were gapping all the way up
here above the price action from the
previous couple days, but then we came
down and formed bearish consolidation.
The one thing that bucks this bearish uh
angle is this big red or big green
candle, excuse me, the one at 10:00.
because in a bearish uh consolidation,
you would prefer price to come down and
really kind of chop sideways from that
point, not really get a monstrous bounce
and then chop sideways. So, this is kind
of a a neutral candle. Not as much
bearish uh I would describe there on the
daily chart. Nonetheless, we didn't
advance much, you know, but we are
starting to put in wicks down here
showing again that tech can still stay
elevated despite any sort of higher
rates. But guys, higher rates is not
really good for growth companies. So,
this is peculiar. We'll see how this
sorts out in the coming days and weeks.
Uh, as you see here though, near-term
support right here at 703 and 9. Upside
resistance is actually going to be this
uh gap fill up here around $737.
Uh, next up into the SMH. And guys, I
remind you too, I follow the SMH as a
leading indicator. I highly recommend
everybody else do that too, particularly
during this AI data center buildout.
Everything has been piling in as far as
monies, new investments, circular
rotation from Nvidia, investing in this
company and that company. It's all
really tied to the momentum going on in
the SMH. So, let's take a look at that
SMH. And you notice today we did close
again. Now, three days in a row
underneath this inclining uh trend line.
However, yesterday as we highlighted, we
did not close underneath the candle that
broke the trend line. That's the candle
that matters the most. So if you want to
see this SMH take a little bit of a
breather, which by the way is healthy
for markets. It's healthy for them to
have big pushups and drawbacks. So it
has a chance to build momentum to
continue moving higher. Otherwise, it's
just a a rocket a roller coaster pushing
up on the charts getting overextended
like what we saw here. But you can see
the divergence that's taking place that
also is highlighting something's not
right with this current price action
continuing to push up. It's like it's
looking like it's trying to come down on
the charts. Yet, we find ourselves again
tacking the top of this inclining trend
line today. It was most evident the
sharp selling pressure on the SMH.
Opened up here today, sold off equally
with these three candles, but more of a
big big plunge on the SMH. And then look
at that bounce. The bounce was even
higher than the Q's and also maintaining
a close right here in this consolidation
range elevating up ever so slightly
after hours. So the SMH we already know
this it's resilient but then now that
does put in three consecutive days
closing underneath. The thing to watch
in the future guys is the low on this
June 23rd candle at $61727.
If we get a daily close under that while
price is still under this inclining
trend line then we will have more
downside probabilities will increase.
However, if we get a close back up above
this trend line then all of that resets
and we need to see when the next trend
line breaks. So be paying close
attention to price action tomorrow if it
does close above $648.91.
Next up the 10ear yield guys. tenure
yield did actually come down with that
PCE number today. Mainly, I touched on
it at the beginning of the show. It
wasn't a surprise to the upside. It was
within expectations which helped pull
down the 10-year yield as you see here,
breaking that consolidation. We were
about to break above this high pivot and
then that all of a sudden changed both
Wednesday and today with current price
on the 10-year yield coming down. Next
support at 4307%.
Little whiplash action. no confirmation
above this pivot high I must add. So
that is a key determining factor for
either a fake breakout and then
consequently a big reversal in the
opposite direction. Uh next up gold and
silver actually put in positive days
today catching a little bit of a bounce
right here from yesterday's low at 3959.
Uh if we do continue up near-term minor
resistance since we didn't confirm
underneath with this break yet, minor
resistance at $4,122.
Major resistance on this declining trend
line at $4,295.
Now, also major support down here at
$3,886
in case we do start chopping sideways,
which will then eventually lead to a
little bit more downside on the charts.
Next up, silver. Also, like gold, as I
said, had a positive day today, up about
1%. It did not kiss it did not, pardon
me, it did not touch this $559
support level. Instead, caught a bounce
at $5562.
We'll be watching very closely in the
next couple days how high this bounce
takes us on the chart of silver. Yes,
with the 10-year yields coming down,
helped both the metals, silver and gold,
continue higher on the charts. I want to
see though how long this chops sideways,
mainly closing underneath this dotted
line, which is the 50% area of the
parallel channel. If we do get above it,
we will have some decent resistance here
at $6152.
That will be a big accomplishment for
silver. If it can get back through that
area, particularly without even touching
this level of support at 5509. Still
have not yet bought my physical silver.
I was waiting for at least a tag of that
5509 getting in between that range and
the $49.96
support level. Next up, US oil. As I've
said the last few days, guys, US oil has
been due for a bounce. Uh we've had
sharp moves down and then also the daily
RSI has breached the 30 threshold down
at the bottom of the chart. I was really
anticipating a better bounce at this
level at 7556, but we see with that
selling pressure, it was very minimal.
and then we came straight down to this
next level of support. Well, guys, this
line has been on my chart um literally
for months. Uh this that's amazing how
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yourself a better trader. All right, so
back into US oil. This is exactly where
the bounce is occurring. Next resistance
up at $7556.
All right, now if this level, if we do
start chopping sideways, create bearish
consolidation. The next supports all the
way down here at $62.33.
I'm not anticipating that getting hit
anytime soon. Matter of fact, there was
actually even news of an attack on a
ship in the Straighter Hormuz today. So,
I I anticipate this all to be somewhat
fragile with this peace agreement until
we uh get past this time frame, maybe at
least a few months down the road. All
right, next up into NAC gas. Really
didn't do too much today. Chopped
sideways up.9% tested the bottom of this
inclining trend line. Did not get all
the way up to the parallel channel
entry, but still just remaining
underneath this inclining trend line.
We'll see if we get any sort of
confirming uh push down uh tomorrow. But
this level is significant resistance
near-term for NAC gas at $3.36.
Uh next up into Bitcoin, guys. Now,
start here on the daily time frame.
Bitcoin so far today is doing a good job
not having a daily close underneath this
low here on Friday, June 5th. If we get
a close later today underneath this
candle, that will increase probabilities
for more downside to come. Next support
53,000 followed by our head and
shoulders target which we have talked
about at length here at 37,508.
If I flip on the RSI, look what's going
on down here at the bottom of the
screen, folks. We got all the way down
here about 15 on the RSI when we sold
here at the beginning of June. Now we
bounced up and finded price at the same
location. However, RSI is right on top
of the 30. That's divergence. That's
telling you Bitcoin is trying to put in
at least a near-term bottom. So, be
mindful of this and watch for resistance
right up here on this inclining trend
line. $63,449.
That will be minor resistance right
here. Uh since we have had two days
under though, it still should be a test
for Bitcoin to get back up above that
trend line. So, near-term gone over both
the support and resistance. Plus, it's
leaning for, at least I say, a little
bit of a bounce unless we get a close
underneath this uh June 5th candle. Next
up, I've got a viewer request uh from
Louis 24 wanting to see some charting
analysis on XLM. I'm starting here on
the weekly time frame and let me pause
first. Thank you guys for all the
comments. It really means an awful lot
to me. I know we put in a ton of work
here to give you guys a lot of good TA
and so thank you for the comments, the
interactions. It really means a lot. I I
try to improve my show based on those
comments. Plus, I try to feed you guys
some charts that you like as well. So,
uh this win-win for everybody, right?
So, let's get into this chart on XLM.
Now, XLM, this is like the cousin of
XRP. This deals with more uh third world
countries that don't have banking uh
institutions readily available for their
citizens. So, if you see this here,
we've had an inverse head and shoulders
pattern that played out earlier. It was
basically last year in July. And since
then, look at how price has come down,
caught support on that neckline,
breached it, then got back above and
bounced right back up. So near-term,
this was a great back uh or great
bounceback above this trend line. Now we
get into the daily chart, and now you
see the story changes a little bit. All
right, we put in a daily topping tail
here on May 30th. That was the signal
that this was a big move up and likely
to be met with selling pressure, at
least for the near to midterm.
Unfortunately, it has broken this
declining trend line twice. You can see
the momentum tried to propel it back up,
but it failed. And since we have
confirmed back underneath that declining
trend line. So, for upward momentum, you
got to beat this line. Beat this 19.5
line that will help you regain the
momentum and potentially overtake this
uh daily topping tail. We are right into
support right here at 17.3 cents, but
we're not oversold on the daily. We
should be due for a potential bounce in
this area. Look at all of the pivots. If
you look back here on my screen, that's
a lot of different levels of support
right here in this range. So, that tells
me a couple things. If this level does
not hold, man, XLM is weak and Bitcoin's
likely going to drag the rest of the
crypto space, altcoins, all down to that
head and shoulders measured move target.
But, as I've said, Bitcoin's looking
like it's trying to bounce. So, be
anticipating potential support here with
a resistance at 19.5. If this breaks and
head and shoulders pattern plays out for
Bitcoin, we could be seeing XLM down
here sub4 cents at 13.95 cents. Uh next
up into Qualcomm. Now Qualcomm had great
news today. They came out and uh the
stock reacted to it and pushed up much
higher. You could see this. This was a
great move up, yet it only finished
3.79% up on the day. Decent selling
pressure after that gap up on the
charts. Here's on the 10-minute chart.
You can see it very cleanly all the way
up here along with the rest of the tech
play and then big selloff but we didn't
bounce straight up as fast as we did on
say SNDK or MU or WDC or any of these uh
high-flying memory stocks. Qualcomm
instead started selling off towards the
end of the day even getting close to the
lows before on the last 10-minute candle
putting in a nice big wick. So on the
daily chart, what does that do for
Qualcomm? Well, there's a couple things
going right here with this current
chart. We've uh tested the top range of
this parallel channel, even breached it,
and have since gotten rejected. So,
near-term upside resistance is going to
be found on this declining trend line,
roughly about $227
on the chart. However, at the same time,
notice with these rejections of the
parallel, it's starting to form a head
and shoulders pattern with the left
shoulder there, the head, and the right
shoulder. Now, this uh trend line you
see drawn horizontally across your
screen is the neckline of that head and
shoulders pattern. We have not breached
it. We have not triggered it. But man,
if we do, that will pull Qualcomm out of
this parallel channel down to $121.37.
That would be a pretty significant drop
considering what type of run Qualcomm
has just had. So, I'm doubtful that we
will have this head and shoulders break
and this major move target be hit unless
the entire markets are in some sort of
uh downward spiral. But, nonetheless,
it's there on the charts. And so I've
got to pay attention to it and be
mindful that Qualcomm could be seeing
further downside if we do breach this
$1912
level. Be watching that tomorrow,
especially with today's big selloff
after the gap up that we experienced. Uh
next up we've got Blackberry, guys. Look
at this move on BlackBerry. Now they do
report earnings today. Um but man, today
they jumped the gun. Pushed up about 20%
on the day. Notice how price action made
a pinnacle over here in June 3rd and
fourth and then retreated back on the
chart. Now, let me zoom back out to give
you some longer term analysis and what
exactly this did on the weekly time
frame. You can see it right there. It
generated a weekly topping tail. Now, we
went over weekly topping tail the other
week with the SMH and how it negated it
within two weeks. Now, Blackberry's
trying to say, "Watch this. I'll negate
mine in about three weeks." So, we're on
watch for tomorrow. If Blackberry can
close above $10.93,
that is going to be very positive for
BlackBerry near term, negating a weekly
topping tail in just a matter of three
weeks. But I remind you guys, look at
the RSI whenever you're wanting to jump
into a stock. It's overbought near-term.
We can clearly see that. Now, Blackberry
pivoted going from phone production into
uh cyber security. Thus, you see a big
jump in their stock as you as as what's
on display. But when we're overbought
like this, just look what happened last
time we were overbought. We had a steep
decline from $6.29
all the way under $3. You're talking
about a 50% decline. Now, I don't think
that's going to happen here for
BlackBerry. But if Blackberry does not
negate this topping tail, be mindful of
the top of this parallel channel as
price could retreat back down to $7.26.
26 before then attacking $1121
followed by $12.39.
And you can see BlackBerry has certainly
fallen from grace and can move up on the
charts once it gets its footing
together, but right now and near-term it
seems a little bit overbought for my
liking to jump in. I'd rather wait for
some sort of pullback and then it's
particularly on the top of the parallel.
That would be the most ideal for a
returning bounce there on that chart.
And then lastly, guys, into GLW making a
brand new all-time high today, pushing
up 10.78%.
Got very close. You see yesterday, we
did get up to $2179,
but then had some decent selling to
close down here in the 206 range. And
then we just continued the momentum
rallying right back up on GLW, but it
put on the breaks right here on this
inclining uh parallel channel right at
the top today. Now you see I've got
another trend line that's connected from
the high in February 25th and connected
over to the high in May 13th. This is
what I generally do when we have
breaches of the top of parallel
channels. It almost gives me a a
resistance zone in which GLW will likely
have resistance again. And tomorrow that
level is at $23925.
But first things first, got to get above
the top end of this parallel channel,
$22959.
And then we could be looking at that
topend resistance. But great move on GLW
considering look at that weekly time
frame on this chart. It's been down in
the gutter under 40 and under 50 bucks
for the majority of its lifetime. And
then all of a sudden somebody gave it
the defiill and then bang there we go up
on the charts. Incredible move. Looking
like it is about to negate another
weekly topping tail. Much like the
Blackberry chart, tech is on fire, guys.
um looking like it was going to take a
delay just the other day before Micron
earnings, but we just did not get that
PCE data. Core PCE came in hot, but not
over um and not surprised uh with the
figure. So, everything's still in line.
We're going to watch tomorrow pretty
closely and I'll give you a good recap
on that next week on Monday. Guys, thank
you so much for being here with me.
Don't forget to like and subscribe.
Also, send this out to your friends and
family so they can learn technical
analysis on the charts. Thank you again
for watching. I'll see you next time
right here on the charts, folks. Take
care.
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