Market Health Check
Risk Off Criteria, Navigating The Short Term, Small Caps & Bonds
Week 3: Market Health Check
The S&P 500 ended last week down 0.64%, while the Nasdaq notched another record weekly close, gaining 0.73%. The Russell 2000 fell 2.58%, and ARKK—the preferred trade for a continued melt-up scenario—declined by 2.5%.
Although caution is higher heading into next week than at any point in the past month, the outlook still leans bullish. This week’s note will provide an update on market health, key levels to navigate the near term, and insights into small caps and bonds to complete the weekly overview.
Trade Closed
Two and a half months ago, this newsletter introduced Asana Inc. as a trade idea. At the time, I wrote: “Two scenarios are under consideration: (a) the stock finds support at this level—price memory often plays a role here, or (b) a failed breakdown occurs—these typically unfold rapidly, so patience won't be necessary to see it through.” Scenario (a) played out quickly, delivering a clean and efficient trade over a two-and-a-half-month duration.
While this trade is now closed, Asana remains on my radar for future opportunities.
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