Technical Analysis Weekly Recap - March 15, 2025
Technical Analysis Weekly Recap - March 15, 2025
Meeting Summary – Weekly Technical Analysis Webinar (March 15, 2025)
Quick Recap
The team discussed the recent market correction, analyzing various market indexes, potential support levels, and resistance areas. They reviewed the performance of several tech stocks, identified stocks showing relative strength, and discussed trading strategies for the coming weeks. The conversation also covered potential bounce areas in the market, sector performance, and stocks demonstrating particular strength or weakness.
Next Steps
Team: Monitor Walmart’s price action for potential entry points around the $82–$85 range.
Research: Analyze historical instances where the VIX and market indexes declined simultaneously to understand market patterns.
AI-Related Trades: Monitor and execute AI-related trades during the upcoming Nvidia Conference starting March 17, particularly focusing on key technology stocks.
Tariff Monitoring: Track the next tariff round on April 2 for potential market impacts.
Stop Orders: Set stop orders for specific stock positions at designated levels.
Trading Positions: Manage trading positions within specific price ranges, with additional entry points if the price drops further.
Portfolio Adjustments: Consider potential exits for specific stock positions at target price levels.
Relative Strength Analysis: Monitor stocks demonstrating resilience to broader market pullbacks, such as IBM.
Dividend Stocks: Consider dividend-paying stocks like AT&T and Verizon as potential investments during the market pullback.
Energy and Utilities: Track energy sector stocks, particularly ConocoPhillips, for potential entry points based on current momentum. Also, monitor utilities sector stocks for reduced tariff impact opportunities and dividend plays.
Emerging Stocks: Watch select stocks for further momentum following breakthrough announcements.
Market News: Follow up on key technology and cybersecurity stocks for updates on news and performance.
Position Sizing Strategy: Review and adjust position sizing using a risk-managed "one-share entry" technique for declining stocks.
International Equities: Research investment opportunities in international and European markets as potential alternatives to U.S. stocks.
Inverse ETFs: Continue managing inverse ETF positions and take profits strategically.
Meeting Planning: Prepare for the next meeting in case of scheduling conflicts.
Summary
Market Correction Analysis and Historical Context
The recent market correction was compared to historical pullbacks, with a focus on the Dow, which is currently down about 10%. While the correction is significant, it is not as severe as past downturns, such as the 22% correction from January to September 2022 or the 36% Nasdaq pullback from November 2021 to December 2022. The VIX index was analyzed, showing that volatility has been decreasing even on market down days, which could indicate a potential market turnaround.
Market Indexes and Potential Reversal
Various market indexes, including the Dow, Nasdaq, Russell, and S&P 500, were analyzed. Most indexes remain in a downtrend, though the Nasdaq appears to be in the best position for a potential reversal. Increased trading volume in recent weeks, particularly in the S&P 500, could indicate a significant sell-off. Analysts warned that Friday’s positive close might be a "dead cat bounce," advising caution for bullish investors. The VIX index was also discussed in relation to potential market inflection points.
VIX Breakout and Sector Analysis
The VIX is trending upward, with a potential breakout to $20. While market indexes are breaking down, certain stocks and sectors show relative strength. AI-related stocks were highlighted as key trading opportunities, particularly in anticipation of the Nvidia AI conference. Sector analysis identified energy, utilities, and real estate as showing resilience, though concerns remain that these sectors are not major components of the S&P 500. Materials and energy stocks were examined for potential support levels and trading patterns.
Tech and Industrials Sector Performance
Technology and industrials sectors have performed well, while consumer staples have been under pressure. A potential market rotation out of winning sectors into more defensive names was discussed. Key stocks demonstrating strength or weakness were highlighted, with a focus on identifying potential bounce areas. Utilities, which are less impacted by tariffs and offer strong dividends, were noted as a strong sector for investment consideration.
Stock Performance and Safe Plays
The momentum in energy and utilities sectors was reviewed, highlighting key stocks in these industries. Potential safe plays with strong dividends, such as Realty Income Corporation and AGNC, were identified. Additional stocks were added to the watchlist, particularly in the energy sector, including Exxon, Valero, and BP.
Tech Stocks Performance and Trading Strategies
Several major technology stocks, including Amazon, Google, Meta, Microsoft, Netflix, Nvidia, Tesla, and Broadcom, were reviewed. Many of these stocks remain in a downtrend but are showing signs of basing or bouncing. The importance of confirming price levels before entering trades was emphasized. A new trading strategy involving placing small orders at key levels to minimize risk while identifying potential opportunities was introduced. Additional strategies, including a "fallen knife" approach, were discussed, where stocks are bought in stages during a downtrend, followed by a structured recovery strategy.
Stock Performance Amid Market Volatility
Market volatility has led to significant stock pullbacks, with some down 30–50% from recent highs. However, some stocks, such as IBM, have demonstrated relative strength. Entry points and support levels for various stocks, including Ford, Home Depot, and Micron, were identified. The importance of assessing market conditions before making trades was emphasized.
Company Performance and Investment Opportunities
The performance of companies across various sectors was reviewed. Homebuilders, including Pulte Homes and DHI, were observed basing sideways, while others, such as Toll Brothers, showed signs of recovery. A quantum computing company experienced a rapid price increase following an earnings report. Retail stocks, including Walmart, Target, and TJ Maxx, were discussed, with Walmart identified as a potential investment opportunity due to its growth potential and dividend yield.
Stock Performance and Future Growth
Various stocks were analyzed for potential growth opportunities. Some stocks, particularly those with high price-to-earnings (PE) ratios, were noted as more susceptible to market fluctuations. Stocks experiencing significant declines but potential recovery opportunities were also reviewed. The importance of continuously monitoring stock performance and making data-driven decisions was emphasized.
Stock Market Analysis and Predictions
Stocks such as AMD, which have been in a continuous downtrend, were analyzed for potential entry points. Short-term trading opportunities in AI-related stocks were identified. The airline sector was also reviewed, with observations on headwinds such as oil prices and travel restrictions. Other stocks, including Verizon, Walgreens, Block, and Zoom, were evaluated for potential support levels and investment strategies.
Trading Strategies and Market Volatility
Different trading strategies for the coming weeks were discussed. Key market events, including upcoming tariff rounds and international equity movements, were identified as potential influences on stock performance. Strategies for managing market volatility, including inverse ETFs and short-term trades, were shared. Long-term investors outlined plans to hold their positions despite current losses, while others discussed strategies for recovering from downturns. Various trading techniques, including cash-secured puts, were highlighted as income-generating strategies in the current market environment.
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