Trading Plan: 6 April 2022
Nasdaq (-2.26%) couldn’t pass the resistance and went south. Now, it might need time to build a base to continue higher… unless the price breaks down under 14150 or even EMA21.
SP-500 (-1.26%) closed also in red with higher volumes than yesterday. More chances to see some tests of the lows before approaching the resistance again. Check resistance levels (black line) and the main averages (SMA200, EMA21, SMA50).
In the news
Microsoft wants to help business customers simplify those annoying software updates.
Twitter says it will test an edit feature.
Amazon signs a massive rocket deal with 3 firms, including Bezos’ Blue Origin, to launch internet satellites.
$SAVE soars on $3.6 Billion JetBlue Offer.
Stocks Drop as Investors Fret About Fed’s Plans to Tame Inflation. The Fed will continue tightening monetary policy methodically through a series of interest rate increases and by starting to reduce the balance sheet at a rapid pace as soon as the May meeting.
30-year fixed mortgage rates have surpassed 5% for the first time since 2011.
Sectors
Best yesterday sector: Utilities, then Healthcare. Worst sector: Consumer Cyclical.
Best weekly sector: Utilities, then Consumer Defensive. Worst sector: Technology.
Best monthly sector: Consumer Cyclical, then Communication Services. Worst sector: Energy.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 79.72
VIX (neutral under 20): 21.03
Equity Put / Call Ratio (neutral between 0.7 and 1): 0.95
CNN Fear & Greed: 51 (Neutral)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 52.83%
Stocks above SMA200 (neutral above 30): 35.51%
Number of stocks that increased yesterday by more than 4%: 97
Number of stocks that decreased yesterday by more than 4%: 530
McClellan Oscillator (neutral between -100 and 100): -13.63
Earnings Reports
Noteworthy earnings reports for today:
What to trade today
The markets moved lower on investors’ inflation-related anxiety. Fed Governor Lael Brainard indicated her interest in boosting interest rates higher and moving fast to shrink the Fed’s balance sheet.
Many watched stocks closed with red wide range bars yesterday, especially in the growth category. More time is needed now for building a constructive base. And for shorting it might be too early.
No intention to open new positions 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.
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