Trading Plan: 26 April 2022
Nasdaq (+0.30%) jumped back from the support area. Still being in the bear flag, let’s watch how the price will do next: continue back to highs, consolidate here in the support area or break the support at February lows.
SP-500 (+0.57%) closed the day also in green with important volumes and the price formed good looking bottoming tail candle. Watching if the move will be confirmed today by a close above yesterday’s close.
In the news
The Twitter board on Monday agreed to a $44 billion buyout from Tesla CEO Elon Musk. But few additional details are known, leaving users and employees uncertain of what the future holds.
Investment banks slash expectations for China’s economic outlook — one sees GDP growth of less than 4%.
Ford is increasing its F-150 Lightning production to keep up with escalating demand & to secure the company’s spot among top EV manufacturers.
GM says it will produce electric Chevrolet Corvettes.
Sectors
Best yesterday sector: Communication Services, then Technology. Worst sector: Energy.
Best weekly sector: Consumer Defensive, then Real Estate. Worst sector: Basic Materials.
Best monthly sector: Consumer Defensive, then Real Estate. Worst sector: Communication Services.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 74.05
VIX (neutral under 20): 27.02
Equity Put / Call Ratio (neutral between 0.7 and 1): 1.16
CNN Fear & Greed: 40 (Fear)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 37.89%
Stocks above SMA200 (neutral above 30): 33.17%
Number of stocks that increased yesterday by more than 4%: 389
Number of stocks that decreased yesterday by more than 4%: 257
McClellan Oscillator (neutral between -100 and 100): -75.76
Earnings Reports
Coca-Cola earnings beat Wall Street estimates as revenue jumps 16%. Activision Blizzard Q1 sales miss as “Call of Duty” sees weak demand.
Earnings from Google parent Alphabet ($GOOGL) will be released after Tuesday’s close. Consensus estimates for Alphabet’s first-quarter are for earnings of $26.11 per share (-0.7% YoY) and revenue of $68.1 billion (+23% YoY). Like so many other tech stocks, Microsoft ($MSFT) has had a rough go of it in 2022 — down more than 16% for the year-to-date. But despite the decline in share price for this mega-cap stock, the company’s fundamentals remain solid. On the bottom line, the average outlook is for $2.18 per share (+7.4% YoY).
Other noteworthy earnings reports for today & EPS estimates:
What to trade today
Even though the reversal has a higher chance to happen based on the technical formations (but let’s wait for confirmation first to avoid being trapped in a “dead cat bounce”), the market is very risky now. Cash is a position also.
Today will be an observation day, with no planned trades.
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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