Trading Plan: 10 August 2022
Nasdaq (-1.19%) continued its downtrend and closed in red with above-average volumes. It is possible to have a short-term top and now the price is looking for a (new) support. Watching 12350 level and the next lows if the case.
SP-500 (-0.42%) is still in a constructive area if it stays above the 4080 area. Building a base here might be healthy for a stronger breakout. But never rely on this only, anything can happen and we might see the price going down to EMA21 / SMA50.
In the news
Elon Musk sells 7.92 million Tesla shares worth $6.88 billion.
Biden signs China competition bill to boost U.S. chipmakers.
Ford will reopen F-150 Lightning orders this week at a much higher starting price.
U.S. productivity posts biggest ever annual drop in the second quarter.
U.S. consumer price growth is expected to slow due to lower gasoline costs.
Sectors
Best yesterday sector: Energy, then Utilities. Worst sector: Consumer Cyclical.
Best weekly sector: Basic Materials, then Financial. Worst sector: Energy.
Best monthly sector: Consumer Cyclical, then Technology. Worst sector: Healthcare.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 55.28
VIX (neutral under 20): 21.77
Equity Put / Call Ratio (neutral between 0.7 and 1): 0.95
CNN Fear & Greed: 49 (Neutral)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 72.66%
Stocks above SMA200 (neutral above 30): 29.64%
Number of stocks that increased yesterday by more than 4%: 114
Number of stocks that decreased yesterday by more than 4%: 437
McClellan Oscillator (neutral between -100 and 100): 65.94
Earnings Reports
Coinbase COIN 0.00%↑ shares drop on billion-dollar loss in the second quarter and revenue miss. Roblox RBLX 0.00%↑ misses on top and bottom, shares dip 12%. Norwegian Cruise Line NCLH 0.00%↑ shares fall as revenue and outlook lag pre-pandemic levels. Novavax NVAX 0.00%↑ cuts 2022 revenue guidance in half, stock tanks in after-hours trading. The Trade Desk TTD 0.00%↑ reported revenues that topped expectations and earnings in line with consensus. The company says internet TV ad revenue growth was a bright spot and expects its partnership with Walmart to boost its full-year growth.
Bumble BMBL 0.00%↑ has been a bright light in 2022, with shares up 7.4% for the year-to-date – easily outperforming the broader market's roughly 13% loss. The company is expected to post a per-share loss of 1 cent, narrower than the 5 cents per share it lost in Q2 2021. Revenue is forecast to land at $219.4 million (+17.8% YoY).
Walt Disney DIS 0.00%↑ is slated to report its fiscal third-quarter results after Wednesday's close. Analysts, on average, estimate earnings of $1.00 per share for the three-month period ended June 30, (+44.9% YoY). The Street forecasts revenue to jump 20.6% to $20.5 billion.
Other noteworthy earnings reports for today:
What to trade today
The market is still in the “middle”, hard to identify a direction. For now, it seems it will reverse ti its means (EMA21 / SMA50), but anything can happen. The market doesn't care about what we are thinking.
Remain vigilant. Stay open. Here is a nice story of Soros’s market approach:
"A trader named Jean-Manuel Rozan once spent an entire afternoon arguing about the stock market with George Soros. 'Soros was vehemently bearish, and he had an elaborate theory to explain why, which turned out to be entirely wrong. The stock market boomed.
Two years later, Rozan ran into Soros at a tennis tournament. 'Do you remember our conversation?' Rozan asked. 'I recall it very well,' Soros replied. 'I changed my mind, and made an absolute fortune.”
I do not plan to take any trades today. I will watch:
Alliance Resource Partners ARLP 0.00%↑ is in a trend, low volumes recently, some good accumulations. A price above $22.3 might work. Stop Loss: yesterday low.
There are also some interesting patterns with low-risk entry, but my plan is to wait to get some traction again before opening new positions.
Do your due diligence if or when placing a trade. All ideas stated here are my own and do not represent trading or investment advice.