Tickers discussed: SPY QQQ IWM FB AAPL AMZN GOOGL MSFT NFLX TSLA TLT SMH $NYMO $NAMO
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
Although we are on the downside of earnings mountain, still plenty to keep us busy.
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
Game Changer
Since March 2020 we’ve been in a raging bull market. Yesterday marked a change of character from a technical perspective. Why? A significant number of indexes, sectors, and important marquis names have triggered SELL SIGNALS on the Daily Charts. In the video I go over the following sell signals for SPY, QQQ, IWM, SMH, AAPL, FB, AMZN, NFLX, TSLA, MSFT . GOOGL remains the FATMAAN outlier that has not triggered a sell signal yet, but it sits on trendline support. A red day pushes it over the edge. That is a change of character. While its too early to tell when / if robotic dipsters will come to the point of recognition that ” This isn’t working” . For us, we need to respect the sell signals. The psychology of the game rotates to “sell the rip” instead of buying the dip until the charts let us know we’re wrong.
$NYMO / $NAMO Oscillators
Regardless of the sell signals, the oscillators are telling us the market is moving into oversold conditions as the indicators both move to minus 60. Yes we can move lower, but the risk / reward for continuing to be short is diminished. While we could see a flush out move today, I want to be looking to cover shorts into well-defined support levels and then either step aside or reverse to long for a short -term tactical trade but then be looking to fade the bounce into resistance for the next leg lower in the broader markets.
Bonds – Nowhere to Hide
After the hot CPI print, it did not take long for rates to rise during the day. You’d think that with the broader markets selling off that TLT would get a safe haven bid as traders / investors exit risk positions. Didn’t happen. Bond traders are challenging the notion presented by the FOMC that rates won’t rise for a long time. They are figuring that with inflation returning, the FED will have to move sooner rather than later. Setting philosophy and motivations aside, from the chart we see that price broke below the high volume / price bar at $138. Now, the only thing between price and the prior lows is $135. If price breaks $135, look for a move to a $132 handle. Prices below the prior low should usher in a fresh wave of sellers. I am short TLT via Jun puts
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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