Trading Plan: 28 September 2022
Nasdaq (+0.25%) continues its consolidation here. The price gapped up in the morning but gave back almost all its gains until the close. It seems the sellers are in control, but still, I do not think this is a time for a bet. Watching yesterday’s high and low for a short-term possible direction. Of course, keep an eye on the marked levels.
SP-500 (-0.21%) undercut the June low, but (some) buyers came in and send the price back above the old support level. However, we had a distribution day with above-average volumes, so the sellers are strong also. To place some bets, I will like to see the price out of this area first. All scenarios are possible.
In the news
Dow Slips Again After Entering Bear Market.
Chinese EV maker Li Auto falls after it cuts delivery outlook; Beijing extends tax breaks for electric cars.
Intel Introduces Videogame Graphics Chips to Challenge Nvidia.
Hertz is teaming up with oil giant BP to install thousands of EV chargers in the U.S.
Cloudflare takes aim at AWS with the promise of $1.25 billion to startups that use its own platform.
GM delays return-to-office mandate after employee backlash.
Sectors
Best yesterday sector: Energy, then Basic Materials. Worst sector: Utilities.
Best weekly sector: Healthcare, then Consumer Defensive. Worst sector: Energy.
Best monthly sector: Healthcare, then Consumer Defensive. Worst sector: Real Estate.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 29.59
VIX (neutral under 20): 32.60
Equity Put / Call Ratio (neutral between 0.7 and 1): 1.15
CNN Fear & Greed: 16 (Extreme Fear)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 12.07%
Stocks above SMA200 (neutral above 30): 16.10%
Number of stocks that increased yesterday by more than 4%: 308
Number of stocks that decreased yesterday by more than 4%: 129
McClellan Oscillator (neutral between -100 and 100): -226.57
Earnings Reports
BlackBerry shares fell 3.54% after hours despite the company beating expectations.
Noteworthy earnings reports for today:
What to trade today
Even if some industries (Energy, Bio, Semis, …) showed good RS while to market is struggling, I do not think this is a time to rush things. I prefer missing the beginning of a new trend, than being in - out of the market too often.
This is what I learned from Livermore:
Keep your list of strong RS stocks handy (review Monday’s Trading Plan for some stocks with potential).
Regarding shorting, I would like to see the market breaking down the support first.
Patience.
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: