Trading Plan: 16 February 2022
Nasdaq (+2.53%) continued to stay in the range by bouncing back from support on the Russia-Ukraine news. The volumes were under the average and the new lows and new highs were more or less the same. I will watch the key levels 13,700 and 14,500 before putting more money in the market.
SP-500 (+1.58%) closed above the SMA200 and marked a higher low. I will watch the Monday low as new short-term support while keeping an eye on the upper side of the consolidation as well (4,590 area).
In the news
Virgin Galactic launched 31.82% after opening ticket sales for its Spaceflight ($450.000).
Elon Musk unloaded $22 billion of Tesla stock - and still owns more now than a year ago.
ConocoPhillips is selling extra gas to bitcoin miners in North Dakota.
Biden pledges ‘full force’ to defend Americans, NATO allies with Ukraine under Russian threat.
Sectors
Best yesterday sector: Technology, then Consumer Cyclical. Worst sector: Energy.
Best weekly sector: Basic Materials, then Consumer Cyclical. Worst sector: Utilities.
Best monthly sector: Energy, then Financial. Worst sector: Real Estate.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 66.8
VIX (neutral under 20): 25.7
Equity Put / Call Ratio (neutral between 0.7 and 1): 0.93
CNN Fear & Greed: 37 (Fear)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 37.77%
Stocks above SMA200 (neutral above 30): 32.70%
Number of stocks that increased yesterday by more than 4%: 766
Number of stocks that decreased yesterday by more than 4%: 53
Noteworthy Earnings Reports / Events
Roblox crumbled 9.10% in extended trading while Airbnb posted fourth-quarter earnings that exceeded expectations on both the top and bottom lines, as well as its first-quarter projections. $ABNB accelerated 9.98%. Marriot made a statement today, climbing 5.76% to all-time highs. Revenue grew a whopping 105% year-over-year. Upstart surged 31.5% in extended trading after beating earnings and sales forecasts. The consumer lending company posted record profits and its revenue grew 252% YoY.
Shopify ($SHOP) stock was not immune to the early 2022 selloff, with shares down nearly 36% for the year-to-date. Analyst earnings per share (EPS) estimates are broad, coming in at 74 cents per share on the low end and $2.64 per share on the high end. The consensus estimate is for SHOP to report fourth-quarter EPS of $1.58, unchanged from the year prior. Revenue is expected to arrive at $1.69 billion, +72.9% year-over-year (YoY).
Other Earnings Reports:
What to trade today
The market is still choppy and there is no real trend in place. One or two days up and then back will kill all the advantages. If trading, consider using a 1/2 of the normal position size and taking profits earlier and smaller risks.
Probably the big investors wait for a “confirmation” from FED in mid-March or simply wait for better signals. Patience always pays. Just watch the price action.
Micron ($MU) is testing the highs again. If the market is at least flat, it might break out above the ATH. The advance can be influenced in sympathy by the $NVDA earnings report (today, after the close). Entry above the black line if volumes come in. Stop Loss: 7%.
Digital Ocean ($DOCN) makes higher and higher lows and closed above the EMA21. It looks constructive and it shows a very nice volatility contraction pattern (VCP). It might be bought above the black line with Stop Loss at yesterday low.
Monday ($MNDY). There are big signs of accumulation recently while the consolidations volumes are low. It might breakout above the black line if volumes come in. Consider using a Stop Loss at 7%.
Crowdstrike ($CRWD) shows low volumes and a decreasing ATR line during its consolidation. It might breakout above the black line. Stop Loss at EMA21.
Zscaler($ZS) stays very well in the flag. It can be bought above the black line with Stop Loss at yesterday low.
Bill.com ($BILL) seems it might want to go higher. Entry above the black line and Stop Loss 7%.
$NVDA (Nvidia) has earnings after hours. It looks very interesting and if the earnings are good, it might pop up nicely. I do not recommend entering before earnings.
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.