Trading Plan: 6 July 2022
Nasdaq (+1.75%) stayed above the recent support and closed just under the EMA21 with volumes higher than the day before. It seems the price wants to reach the SMA50, but before keep an eye on the trend line (marked here with blue). Also, watching the lows.
SP-500 (+0.16) closed flat after a strong reversal during the day. The volumes were average. Watching the trendline / EMA 21 and the lows (also marked with blue on the graph) as well. Can this be the bottom?! Hard to say since generally, we need to have some extremely bad conditions (VIX spike / huge volume in a selloff, etc.) before a constructive advance. Remain open.
In the news
Tesla is no longer the world's largest EV producer (BYD is).
JPMorgan trims price target for Tesla, says shares could fall more than 40% on weaker deliveries.
The space industry's bubble is at risk of bursting.
Amazon, Microsoft and Google Strengthen Grip on Cloud.
The dollar soars as recession fears finally hit the round-the-clock currency market.
Bitcoin miners struggle with crypto’s price decline, rising energy costs and increase in mining difficulty.
Sectors
Best yesterday sector: Communication Services, then Consumer Cyclical. Worst sector: Energy.
Best weekly sector: Healthcare, then Consumer Defensive. Worst sector: Basic Materials.
Best monthly sector: Healthcare, then Consumer Defensive. Worst sector: Basic Materials.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 30.66
VIX (neutral under 20): 27.54
Equity Put / Call Ratio (neutral between 0.7 and 1): 0.90
CNN Fear & Greed: 24 (Extreme Fear)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 29.21%
Stocks above SMA200 (neutral above 30): 16.07%
Number of stocks that increased yesterday by more than 4%: 705
Number of stocks that decreased yesterday by more than 4%: 318
McClellan Oscillator (neutral between -100 and 100): 14.84
Earnings Reports
Noteworthy earnings reports for today:
What to trade today
Good to see a day with nice-looking patterns and strong breakouts CELH 0.00%↑, RBLX 0.00%↑, MDB 0.00%↑, CLPT 0.00%↑, GTLB 0.00%↑, etc.). I do not think we are out of the woods yet, but the market doesn't care about my thoughts, it just acts as it wants to. I will keep watching how this story develops and if a new uptrend really starts, I might test the waters.
United Therapeutics UTHR 0.00%↑ has good accumulation days, it respects the EMA 21, constructive consolidation with low volumes. At a price above the black line with Stop Loss at yesterday’s low a trade might work.
Sanderson Farms SAFM 0.00%↑ is consolidating nicely with good decreasing volumes recently. If volumes come in and if the price goes over the black line, the trade might work. Stop Loss: yesterday’s low.
H&R Block HRB 0.00%↑ is making a beautiful cup and handle above all the main averages. The trend is clearly up and the price seems it wants to go higher. A price above ~$37 might signal a breakout. Stop Loss: yesterday’s low.
Ufp Technologies UFPT 0.00%↑ stays nicely above the EMA21 and had a constructive shakeout on yesterday. A trade above $81.5 with Stop Loss at EMA21 might work.
Okta OKTA 0.00%↑ has a beautiful double bottom pattern with higher lows. Yesterday, it ignited from the SMA50/EMA21 area and the move might continue. A price above the black line might signal a price continuation. Stop Loss: 5%.
ShockWave Medical SWAV 0.00%↑ might offer a cheat for an entry. Good low volumes and declining ATR. A price above the black line is buyable and Stop Loss: yesterday’s low.
Taking into account the bear market, if trading, you may consider using a 1/2 or even 1/3 position to test. Consider also using tighter stops as well.
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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