Trading Plan: 3 November 2022
Nasdaq (-3.36%) broke all the short-term supports and closed weak (at the day's lows) with high volumes. Having another distribution day is just another reminder we are in a bear market. Watching the last month for now.
SP-500 (-2.50%): strong sell-off after the FED news. A clear distribution day: wide red bar, high volumes, price losing SMA50 and EMA21 again. Free fall till now, risky to catch the knife. Just observing the price action. No predictions - as always.
In the news
Fed approves 0.75-point hike to take rates to highest since 2008 and hints at a change in policy ahead.
Dollar Gains, Bonds Fall After Powell Signals More Hikes.
Oil falls as Fed rate hike raises fuel demand concerns.
Twitter is reportedly ready to cut about 3,700 employees.
Sectors
Best yesterday sector: Utilities, then Healthcare. Worst sector: Technology.
Best weekly sector: Utilities, then Financial. Worst sector: Communication Services.
Best monthly sector: Energy, then Consumer Defensive. Worst sector: Communication Services.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 53.91
VIX (neutral under 20): 25.86
Put / Call Ratio (neutral between 0.7 and 1): 1.18
CNN Fear & Greed: 52 (Neutral)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 54.19%
Stocks above SMA200 (neutral above 30): 33.76%
Number of stocks that increased yesterday by more than 4%: 131
Number of stocks that decreased yesterday by more than 4%: 867
McClellan Oscillator (neutral between -125 and 100): 81.61
Earnings Reports
CVS Health CVS 0.00%↑ raises outlook as third-quarter results beat estimates. Qualcomm QCOM 0.00%↑ shares fell in extended trading on Wednesday after the chipmaker reported in-line fourth-quarter earnings and a small revenue beat but offered poor first-quarter guidance. SoFi Technologies, Inc. SOFI 0.00%↑ reports Q3 loss, tops revenue estimates. Etsy ETSY 0.00%↑ shares pop on revenue beat, rosy guidance.
Noteworthy earnings reports for today:
What to trade today
FED “controlled” the emotions yesterday. Long story short, the assimilated message by the market investors was “things will get worse before they get better”. So, again, do not forget:
And there is more for the 14 December, here are the target rate probabilities.
No plan to trade today.
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: