Trading Plan: 4 May 2022
Nasdaq (+0.22%) tried to go higher but remained in the same area. Not great volumes, but it was in a way expected as traders wait for a confirmation. This two-day bull flag may suggest a higher continuation. Watch yesterday's high and Monday's low for now.
SP-500 (+0.48%) also closed higher with average volumes. Traders probably expect the FED outcome today. Price is under all main averages. Watching the support and yesterday’s high levels.
In the news
A 50bp interest rate hike from the Federal Reserve is widely expected given recent commentary from officials and the fact inflation is well above target and unemployment is just 3.6%.
Paul Tudor Jones says he can’t think of a worse financial environment for stocks or bonds right now.
SpaceX is expanding the solar farm at its South Texas launch facility.
SpaceX is expanding the solar farm at its South Texas launch facility.
Zelensky Says Companies Are Supporting Russia’s ‘War Machine’ if They Stay There.
Sectors
Best yesterday sector: Energy, then Basic Materials. Worst sector: Consumer Cyclical.
Best weekly sector: Energy, then Basic Materials. Worst sector: Basic Real Estate.
Best monthly sector: Energy, then Consumer Defensive. Worst sector: Communication Services.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 46.25
VIX (neutral under 20): 29.25
Equity Put / Call Ratio (neutral between 0.7 and 1): 1.05
CNN Fear & Greed: 33 (Fear)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 30.15%
Stocks above SMA200 (neutral above 30): 28.99%
Number of stocks that increased yesterday by more than 4%: 356
Number of stocks that decreased yesterday by more than 4%: 158
McClellan Oscillator (neutral between -100 and 100): -38.07
Earnings Reports
AMD sales jump 71%, shrugging off concerns about PC slowdown. Starbucks suspends its outlook as Covid lockdowns hammer sales in China. Lyft shares plunged on light guidance and continued driver incentives. Airbnb beats estimates with 70% revenue growth as travel rebounds. Pfizer cuts 2022 earnings outlook despite strong first-quarter Covid vaccine and antiviral sales. BP reports a bumper first-quarter net profit, but posts a massive loss on a hit from Russia exit.
Noteworthy earnings reports for today:
What to trade today
We might see a short rally prior to the FED announcement later today but it is wiser to wait to see the real market reaction after the published data. A rise above the expected half-point may be interpreted in a negative way as investors are feared of a recession.
No planned trades for today, just watching. This might be a time to reinforce the patterns and conditions for trading: How to find the perfect stock to trade?
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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