Trading Plan: 27 April 2022
Nasdaq (-3.95%) undercut the February and March lows. The wide range bar is significant and the downtrend might continue. The next minor support is at the 12100 area. A dead cat bounce is highly likely after such a big drop.
SP-500 (-2.81%) closed also in red and might continue its downtrend to the February low. Living under all the main averages is not an ideal market for bulls. Watch the 4100 area for now. The next support is at 4000.
In the news
Alphabet said on Tuesday that its board of directors authorized $70 billion in share repurchases.
Bitcoin and Ethereum both erased over 5.5%.
Fidelity to Allow Retirement Savers to Put Bitcoin in 401(k) Accounts.
Robinhood cutting about 9% of full-time employees.
Russia threatens to halt gas supplies to Poland and Bulgaria.
Elon Musk Empire:
Sectors
Best yesterday sector: Energy, then Utilities. Worst sector: Consumer Cyclical.
Best weekly sector: Consumer Defensive, then Real Estate. Worst sector: Basic Materials.
Best monthly sector: Consumer Defensive, then Real Estate. Worst sector: Communication Services.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 74.05
VIX (neutral under 20): 33.52
Equity Put / Call Ratio (neutral between 0.7 and 1): 1.07
CNN Fear & Greed: 26 (Fear)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 29.79%
Stocks above SMA200 (neutral above 30): 30.39%
Number of stocks that increased yesterday by more than 4%: 45
Number of stocks that decreased yesterday by more than 4%: 780
McClellan Oscillator (neutral between -100 and 100): -142.42
Earnings Reports
Arch Resources ($ARCH) ripped 20.95% after smashing earnings and sales estimates. The coal mining company delivered record net income for the second straight quarter. Microsoft beat on the top and bottom line, notching an adjusted EPS of $2.22 per share (vs. $2.19 expected by Refinitiv analysts) and revenue of $49.36 billion (vs. $49.05 billion per those same analysts.) Revenue was up 18% YoY. The company’s security and cloud divisions helped float them to a small beat. Google, on the other hand, wasn’t quite the beat. The company missed both on top and bottom lines. EPS was $24.62 (vs. $25.69 expected) and revenue came in at $68.01 billion (vs. $68.11 billion expected).
Earnings from Meta Platforms ($FB) will be released after the April 27 close. Analysts expect the Facebook parent to report earnings of $2.56 per share (-22.4% YoY) and revenue of $28.2 billion (+19.3% YoY).
Other noteworthy earnings reports for today & EPS estimates:
What to trade today
Tesla shares logged their biggest one-day drop in more than a year after Elon Musk said he would buy Twitter Inc. in a $44 billion deal. Good short trade posted on Monday Trading Plan.
If the market continues its downtrend, I will watch:
Bill com ($BILL) is building a bear flag. A price move under the support might indicate a downtrend. Stop Loss at yesterday’s high.
dLocal ($DLO) is testing again the support. If the price break the level marked with the black line, the trade might work. Stop Loss at yesterday’s high.
Celsius ($CELH) is consolidating in the triangle around the EMA21 and SMA50. The trade might work in both directions if / when the price passes one of the two black lines. Stop Loss: 5%.
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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