Before the Bell Aug 17

Tickers discussed: SPY QQQ IWM FB AAPL TSLA MSFT  AMZN  GOOGL NFLX $TNX TLT RSP

Before the Bell  is premarket prep for active traders. The note provides detailed stock market technical analysis focused on the indexes and FAAMGs. Key levels and trading locations are provided, along with trading plans and timely commentary to keep you on the right side of the trade.

Earnings 

Companion Video 

The video is a detailed technical review of the indexes and FATMAAN names. All the key trading levels are identified along with commentary and trade plans for each ticker. Trade ideas are also discussed.  Run the video at 1.25x to reduce run time.

Find the Video HERE

 

Macro Data Releases Week of Aug 16

  • Monday –  Empire MFG
  • Tuesday – Retail Sales, Industrial Production, Bus. Inv., Housing Index, JPOW Speech 1.30pm
  • Wednesday – Mortgage Appl, Housing Starts, Oil inventory, 20yr Bond Auction, FOMC Minutes 2pm
  • Thursday – Jobless Claims, Philly Fed, Leading Economic Indicators, NatGas inv., 30 yr TIPs bond auction. 
  • Friday – Rig Count.  August OPEX

Covid’s Long Shadow

I think Covid is taking a psychological and material toll on traders and markets. Asian Markets look really heavy. THe Asian economy is largely our supply chain and is very much under-vaccinated. The result is sluggish productivity and throughput. The charts are correcting. Here too, aside from SPY / QQQ / and the FATMAAN mega caps, there is a lot of corrective activity under the surface. All that said, we are still participating in this rally by watching levels and being primarily FATMAAN focused.  Despite a churning in my stomach, I want to stay bullish as long as possible and be data -driven on when to downshift into a more neutral state. Staying LONG

Bond Rates not Cooperating

Despite our best efforts to avoid a head fake move into value / cyclicals, the rising rate environment has evaporated as quickly as it appeared.  If rates continue to be pinned down, the cyclical / re-opening trade is probably not going to work. That environment favors tech.  We can see it in IWM as it nose dives. If value / reflation / re-opening is working you’d expect that to filter through to small caps, and we just have not seen it.

10 year Bond Yield

TLT

$RSP  Eq. Weighted SPY

The equal weighted SPY continues to do well and on many recent days actually has outperformed the cap-weighted version ( SPY ). You can see price has just broken out of a $6 trading range. The measured move targets $158. Also please notice price walking up the 8ema and with all the ema’s bullishly stacked below. These will act as support on any pull back.

Fear / Greed Sentiment Indicator

Our Fear / Greed meter continues to rise each day. We were at 25 just a couple of weeks ago. Now we’re up to 49. The market is slowly but surely converting sentiment from bearish toward bullish. As with most sentiment measures, a neutral reading has less predictive value than a reading that is pegged bearish or bullish.

INDEX CHARTS

A detailed walk-through of the levels and trading strategy for the indexes is given in the video ( link above) . The static charts are provided for reference. The FATMAAN names are also reviewed in the video along with trade ideas and other charts of interest.

SPY 2 hour

SPY 30 Min

QQQ 2 hour

QQQ 30 min

IWM 2 hour

IWM 30 min

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