Trading Plan: 18 April 2022
Nasdaq (-2.14%) erased all the Wednesday gains while the price remained under all the main averages. It seems the price is building a new zone in which it wants to stay - an area to watch.
SP-500 (-1.21%) closed also in red and under the SMA50 with a higher volume than Wednesday. Having lost all the averages, a close under 4380 might sent the price deep in the south direction.
In the news
Peloton announced that the company will lower prices for its bikes and other fitness equipment, but it will increase subscription fees.
Crypto royalty Bitcoin and Ethereum fell -by 6% a piece.
Europe continues to import Russian gas in spite of Ukraine invasion.
Twitter Adopts Poison Pill Plan to Block Elon Musk From Increasing Stake.
Mortgage rates finally hit 5%. For the first time in 10 years, the 30-year fixed-rate mortgage increased from 4.72% a week ago to over 5% this week.
Sectors
Best yesterday sector: Consumer Defensive, then Energy. Worst sector: Technology.
Best weekly sector: Energy, then Basic Materials. Worst sector: Technology.
Best monthly sector: Energy, then Basic Materials. Worst sector: Technology.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 63.29
VIX (neutral under 20): 22.70
Equity Put / Call Ratio (neutral between 0.7 and 1): 0.90
CNN Fear & Greed: 42 (Fear)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 49.12%
Stocks above SMA200 (neutral above 30): 35.77%
Number of stocks that increased yesterday by more than 4%: 153
Number of stocks that decreased yesterday by more than 4%: 302
McClellan Oscillator (neutral between -100 and 100): -3.67
Earnings Reports
Morgan Stanley saw stronger-than-expected revenue from equity and fixed-income trading amid volatile markets, helping it to top estimates in the quarter. Wells Fargo reported home lending fell 33% from the year prior as mortgage rates have climbed. Citigroup topped expectations for first-quarter profit and revenue on better-than-expected trading results as Wall Street benefited from surging volatility tied to the Ukraine war. Goldman Sachs tops analyst estimates as trading desks crush expectations amid surging volatility
Noteworthy earnings reports for today:
What to trade today
The market seems to be stuck in a newly built area. When it clears these levels, these are the stocks to be watched from my point of view.
Palo Alto ($PANW), APA Corporation ($APA) and Occidental Petroleum ($OXY) are still in the game for the long side. Also, $CVX is still buyable above the highs.
Shorts:
Asana ($ASAN) might break the support. If the price goes below the black line, the short trade might work. Stop Loss: 5%.
$SE also short with a similar pattern.
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.
In order to learn more about trading, you may want to read:
If you enjoyed this story, you may subscribe to receive my newsletter first! If not a Medium member, here you can become one!
Follow me on Twitter for market updates.