Trading Plan: 9 February 2022
Nasdaq closed in green yesterday (+1.28%) and seems to build a base here. New lows (52) were greater than new highs (46), but we can consider them even. Not a clear direction yet, but let’s watch the support and resistance of the small base for now.
SP-500 advanced also (+0.84%) yesterday and the situation looks similar. The price stays between the EMA21 and SMA200, let’s watch a direction when ready to break out or break down. The engulfing candle looks more bullish, but I would like the price over 4530–4540.
In the news
Facebook owner Meta closed with a market cap below $600 billion on Tuesday for the first time since May 2020.
10-year Treasury yield hits 1.96% with inflation data in focus.
Apple Will Let Businesses Use iPhones to Take Customer Payments.
Pfizer Forecasts $54 Billion in 2022 Sales From Its Covid-19 Vaccine.
Sectors
Best yesterday sector: Consumer Cyclical, then Basic Materials. Worst sector: Energy.
Best weekly sector: Financial, then Basic Materials. Worst sector: Communication Services.
Best monthly sector: Energy, then Financial. Worst sector: Real Estate.
Sentiment
NAAIM (weekly, neutral between 70 and 90): 62.54
VIX (neutral under 20): 21.44
Equity Put / Call Ratio (neutral between 0.7 and 1): 0.99
CNN Fear & Greed: 37 (Fear)
Breadth
Stocks above SMA40 (neutral between 30 and 80): 32.77%
Stocks above SMA200 (neutral above 30): 31.34%
Number of stocks that increased yesterday by more than 4%: 402
Number of stocks that decreased yesterday by more than 4%: 132
Noteworthy Earnings Reports / Events for today
Chipotle climbed 6.3% in extended trading after beating on the top and bottom lines. Sales surged 22% year-over-year. Enphase announced record revenue of $412.7 million and the stock soared 16%.
Entertainment and media giant Walt Disney ($DIS) is scheduled to unveil its fiscal first-quarter earnings report after Wednesday’s close. The analysts anticipate Disney theme park attendance will show “signs of improvement” over the three-month period.
Other earnings reports:
What to trade today
The leisure Industry came back to life after all the removed restrictions, but igniting from no-pattern formations can not offer a good risk-reward. Same for Airlines and Recreational Vehicles. Better to form a base first.
Growth stocks have good momentum and used it very well yesterday: when the market showed positive signs, they ignited and this shows strength.
Asana ($ASAN) soared 12.58% and the move might continue. But a pullback is expected. You may buy the pullback or the breakout above the black line with Stop Loss 7%.
Global E-Online ($GLBE) shows increasing volume when advances. Can be bought above the black line with Strop Loss at yesterday low.
Everspin Technologies ($MRAM) formed a cup and handle and can be bought now above yesterday high. Stop Loss at yesterday low.
Digital Ocean forming a double bottom pattern and it seems there are accumulations during the last days. Can be bought above the black line with Stop Loss at yesterday low.
Bill.com ($BILL) very good price action after the wide range bar on earnings (as there were no big selling after that). Looking for a continuation above the black line. Stop Loss at $225.
Hubspot (HUBS) advanced on good volumes and closed strong. Can be bought above $504 with Stop Loss at yesterday low.
Tesla (TSLA) is still good with the same recommendation. It can be bought above the black line with Stop Loss at yesterday low.
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.