UUP 

This is Scott with your Chart of the Day. I am only going to show you one chart because it is really the only chart you really need to care about right now in these market conditions, and it is the US dollar.

Now, on TC2000, my charting platform here, it brings up UUP ( NYSEARCA: UUP ). Maybe on your chart, something like TradingView, it might bring up the DXY, pretty similar but I am going to stick with this one here just because it is on the platform, it is the US dollar. And so as you can see, the US dollar has come out of a little bit of a low here.

The US dollar had some craziness back in March of 2020 and as the Federal Reserve injected liquidity into the market the value of that US dollar dropped. And then when we started to see things kind of creep up here, prices are going up, everything is becoming more expensive, and chatter of interest rates being increased, the value of the US dollar started to creep up.

Ever since this really started to get going markets have had trouble finding a bid because the value of the dollar is going up. So they don’t need to hedge any loss of the dollar with equities or risk assets. And so this, in my opinion, is something that you need to pay attention to. Because as long as the US dollar is in a strong uptrend you are going to find pressure on risk assets and that is going to make for a hard trading environment.

So be sure and watch the US dollar. If you see this start to break down we might then see a bounce in the market. But this is definitely a chart that you should be paying attention to, especially in these market conditions.

UPST 

This is Scott with your Chart of the Day. There aren’t many good-looking charts in this market and even the one I am going to show you is ugly. But I think that Upstart ( NASDAQ: UPST ) could give us a potential short-term bounce trade into tomorrow. So that is one of the stocks that I have on my watch list and one of the stocks I will be talking to members about at stockmarketmentor.com. I will give you a little insight into what I am thinking with this chart.

As you can see, Upstart ( NASDAQ: UPST ) has been in a very strong downtrend since November. It basically peaked when the rest of the market peaked. And a lot of people are saying that Upstart ( NASDAQ: UPST ) breaking down was a clear signal of a market that is overinflated and needs a rest. This has rested, it has rested a lot. From the high back here in October to the close of today the stock is down about 80 percent, that’s a lot for any stock, especially in a market like this.

If I turn on After Hours you can see (I actually have to zoom out), that the stock is down another 47 percent here today after hours due to earnings. So first off, I want you to know one really important thing about trading, it can ALWAYS go lower, even if the stock is down a lot. And you think, okay, I know this is the bottom, it can always go lower. And I also say, never say never in the stock market because I have seen a lot of crazy stuff in my years in the market and so I know anything is possible, both to the upside and to the downside.

I think we should watch Upstart ( NASDAQ: UPST ) tomorrow. I have the Bollinger Bands on this chart, that’s these gray lines right here and right here. And typically what Bollinger Bands do is, contain price action. So a large percentage of a stock’s move will usually be contained within 2 standard deviations of the middle Bollinger Band. And so anything outside of the middle Bollinger Band is typically kind of an abnormal move, it shouldn’t happen.

And so because I have the Bollinger Bands on here you can really see, that when the price gets outside it comes back in. The price gets outside, it comes back in. The price gets outside, it comes back in. And so here we are again, after hours, I don’t know about the earnings report. I didn’t listen to the call, I don’t know what’s going on but it is down a lot and it is WAY outside the Bollinger Bands.

One of the things that Dan Fitzpatrick taught me over at stockmarketmentor.com was, that one thing to look out for is extreme extensions outside the Bollinger Bands because price likes to come back in. And so I am going to keep an eye open for a potential rebound trade here on Upstart ( NASDAQ: UPST ) tomorrow. It may happen first thing, it may not happen at all, but it is one of the setups that I am watching in this market going into tomorrow.

We will want to see the stock establish a low, I don’t know where it is going to open, but we will want to see it establish a low. You will want to define your risk versus that low, and then scale out into any strength to the upside. That is one setup I will be watching into tomorrow.