Before the Bell Aug 5

Tickers discussed: SPY QQQ IWM FB AAPL TSLA MSFT  AMZN  GOOGL NFLX  SMH GM AMD PAYC

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 2

  • Monday – Final MFG PMI, ISM MFG index, Construction Spending
  • Tuesday – Redbook, Factory Orders
  • Wednesday – ADP, PMI composite final, FOMC Clarida @ 10am,  ISM Services, Oil inventories at 10.30
  • Thursday – International Trade, Jobless Claims,  NatGas inventories
  • Friday – July Jobs Number

Bond Rate Volatility.

Bond rates reacted violently to both the huge ADP Jobs miss and the ISM Services print which was the highest EVER.  These moves are alternately ripping or dwarfing asset classes like Gold, cyclicals and rate sensitive assets.  I am waiting patiently for a potential sector rotation into cyclicals but not jumping the gun to hopefully avoid the many head fakes that have been going on.

Signs of a Shift to Cyclicals

Rising Rate Environment Areas of Interest.

  • Falling Dollar is supportive of Commodities and cyclicals in general.
  • Rising Rates ( $TNX ) and / or a break of TLT $148
  • Cyclically focuses ETF’s to watch.:  XLB, XLE, XLF, XLI, KRE, IWM
    • Set alarms on the above EFTs for further confirmation of the move.
    • Traders can then drill down in specific sectors for invididual names if desired
  • Materials.  Commodity and Specialty Chemicals
  • Metals and Mining.  Copper, Aluminum, Steel, XME
  • Industrials. HON / MMM / GE  Infrastructure names
  • JETS / Airlines, Delivery services , marine transport, etc
  • KRE; Regional Banks…………more highly levered to rates than mega banks
  • Travels, Hotels, Cruise Lines re-opening names.

 

Chart Set Ups

$GM

Price is set up for a big test of the 200ema.  Super important level for both bulls and bears. Notice the huge void in the volume / price profile below the 200ema. Price could easily fall $10 on a break below the 200ema at 51.75.  Set an alarm there.  Logical place for bulls to step in and therefore if you want to be long, you can objectively do so with a stop just below the 200ema.

$PAYC Paycom  – Bracket Trades

A nice Bracket set up. Alarm 445.39 and 427.91. Then follow price either higher or lower out of the range. As you can see from the chart, there is about $30 both above and below the bracket for a potential move.

The list of additional tickers in the chart annotations are stocks that are gapping down significantly this morning. Active traders can watch / trade them while others can set up the brackets tomorrow for 2nd day plays.

 

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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