Trading Plan: 4 August 2022
Nasdaq (+2.59%) made a bold strong move (see the volume) above its recent resistance. Next target: 13000 area. And of course, the old resistance at 12300 (the new support now).
SP-500 (+1.56%) almost touched the resistance and succeeded to close higher with important volumes. Watching the resistance and recent lows.
In the news
Bank of England launches biggest interest rate hike in 27 years, predicts a lengthy recession.
Pelosi’s Taiwan trip puts the world’s biggest chipmaker back in the spotlight of U.S.-China rivalry.
China fires missiles into the sea near Taiwan during drills around the island.
EV Maker Lucid Cuts Production Outlook in Half.
Weekly jobless claims rise to 260,000 ahead of the nonfarm payrolls report.
Sectors
Best yesterday sector: Communication Services, then Consumer Cyclical. Worst sector: Energy.
Best weekly sector: Technology, then Consumer Cyclical. Worst sector: Energy.
Best monthly sector: Technology, then Consumer Cyclical. Worst sector: Basic Healthcare.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 47.21
VIX (neutral under 20): 21.95
Equity Put / Call Ratio (neutral between 0.7 and 1): 0.89
CNN Fear & Greed: 46 (Neutral)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 71.96%
Stocks above SMA200 (neutral above 30): 29.53%
Number of stocks that increased yesterday by more than 4%: 638
Number of stocks that decreased yesterday by more than 4%: 128
McClellan Oscillator (neutral between -100 and 100): 125.66
Earnings Reports
Moderna MRNA 0.00%↑ beat earnings and revenue expectations by a wide margin despite writing down nearly $500 million of expired vaccine inventory.
Block SQ 0.00%↑ shares seem "undervalued" and are heading into the company's second-quarter earnings report, set to be released after Thursday's close. Consensus estimates for Block's second quarter are for earnings of 17 cents per share (-74.2% YoY) and revenue of $4.4 billion (-6.4% YoY).
Other noteworthy earnings reports for today:
What to trade today
The market is acting well, the price patterns are constructive and it seems it wants to continue the momentum. Of course, until it changes its mind! :)
Until now the longs are working very well. FFIV 0.00%↑ had a good breakout and I have already tightened the Stop Loss.
I will watch:
Vertex VRTX 0.00%↑ made mean reversion with low volumes. A SMA50 rejection is likely and a price above the black line might work. Stop Loss: $272.90.
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.