Trading Plan: 11 July 2022
Nasdaq (+0.12%) made another positive move towards the SMA50, but the volumes were lower than the day before. Watching the breakout above the W pattern and the recent lows as well. Time will tell if we have a reversal or a mean reversion and a resumed downtrend.
SP-500 (-0.08%) succeeded to stay above the EMA21. The retracement after the last 5 days is not bad as we noticed low volumes. But, the big issue is the lack of strong interest from the big institutions. They will be the ones who will influence the (new) trend.
In the news
Stock Futures Fall Ahead of Earnings Season
Twitter shares sink 7% in premarket trading after Elon Musk terminates a $44 billion deal.
Home prices may still rise, but car values are set to fall from the pandemic peak: Goldman.
Crypto rebounded alongside stocks and other risk assets, with Bitcoin and Ethereum notching their best weekly gain in about four months.
Sectors
Best yesterday sector: Healthcare, then Technology. Worst sector: Basic Materials.
Best weekly sector: Communication Services, then Consumer Cyclical. Worst sector: Energy.
Best monthly sector: Healthcare, then Consumer Defensive. Worst sector: Energy.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 27.85
VIX (neutral under 20): 26.64
Equity Put / Call Ratio (neutral between 0.7 and 1): 0.92
CNN Fear & Greed: 30 (Fear)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 33.00%
Stocks above SMA200 (neutral above 30): 16.92%
Number of stocks that increased yesterday by more than 4%: 219
Number of stocks that decreased yesterday by more than 4%: 90
McClellan Oscillator (neutral between -100 and 100): 34.62
Earnings Reports
Noteworthy earnings reports for today:
What to trade today
We had a good day on Friday, but low volumes and being at an important level in indexes (SMA50), my suggestion is to be cautious. Following the price is what pays.
Besides managing the open position, I do not plan to trade today. I might consider my approach if prices go above Friday’s high.
Taking into account that we are still in a bear market, if trading, you may consider using a 1/2 or even 1/3 position to test. Consider also using tighter stops as well.
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.
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