Trading Plan: 19 January 2022
Market in correction, another distribution day and Nasdaq broke the channel and closed in red (-2.60%), lower than last week bottom and SMA200. Tech stocks faced new lows and dragged the index with them. New lows 549 vs. new highs 81. Market is under selling pressure, next support is at 14.200. Oils at new highs.
SP-500 down (-1.84%) and broke the channel as well with big volumes. Mostly all stocks closed in red. Next support is at the December lows and after them, 4280 area.
Microsoft has reportedly agreed to take out gaming giant Activision Blizzard in a $68.7 billion all-cash deal.
Boeing has reportedly advised some international airlines to “not to operate the 777 to the U.S. in light of 5G deployment.
Crypto exchange crypto.com has been hacked, leaving hundreds of users with missing ETH. The total loss is reported to be $15 million.
Goldman Sachs tumbled 7% to six-month lows after the bank fell short of earnings expectations. Other bank stocks gapped down as well.
Sectors
Best yesterday sector: Energy, then Real Estate. Worst sector: Technology.
Best weekly sector: Energy, then Basic Materials. Worst sector: Healthcare.
Best monthly sector: Energy, then Basic Materials. Worst sector: Healthcare.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 74.78
VIX (neutral under 20): 22.79
Equity Put / Call Ratio (neutral between 0.7 and 1): 1.00
CNN Fear & Greed: 54 (Neutral)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 36.90%
Stocks above SMA200 (neutral above 30): 37.42%
Number of stocks that increased yesterday with more than 4%: 98
Number of stocks that decreased yesterday with more than 4%: 811
Noteworthy Earnings Reports for today
What to trade today
Oils look good, consolidating at the highs ($DVN, $CVX), Basic Materials also in the game with $AMR and $BTU, $VRTX in Healthcare big retracement, Stop Loss now under the yesterday low. Also, shorts ($ASAN, $MRNA, $CIEN) acting very well.
Crypto is weak now, and Coinbase ($COIN) is at the biggest support. If broken under the all time lows, more pain might come.
Mostly all the short candidates in my watchlist broke their base and went down and are extended now.
Please do your own due diligence if or when placing a trade. All ideas stated here are my own action plan and do not represent trading or investment advice.