Before the Bell May 9

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Tickers:  SPY QQQ IWM FB AAPL TSLA MSFT AMZN GOOGL NFLX SMH  ARK Complex UPST AFRM

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.

Inspiration – Will Return

 

 Earnings

The point was made that earnings misses are being punished more than normal. Also, earnings pops have been free money for faders. For those that are fortunate to beat expectations, almost none have held them. PLTR is first up this morning. It has done a complete round trip to its IPO price under $10.

Today’s 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  1.5x to maximize efficiency without loss of clarity.

Find the Companion Video HERE

Macro Data Releases Week of  May 9

  • Monday –  Russian Victory Day
  • Tuesday – NFIB Small Biz Optimism Survey; FOMC speaker parade
  • Wednesday –  CPI Report; Atlanta Fed Inflation Expectations; Oil inventories; 10 yr bond auction
  • Thursday – Jobless Claims; PPI Final; NatGas; 30yr Bond auction
  • Friday – Import/ Export Prices; Consumer Sentiment; Rig Count

Margin Call

Markets heading lower is going to pressure those still long on margin. This is an area where cascade risk / waterfall selling risk increases dramatically as margin calls are likely to hit the streets. If you are not comfortable shorting or the environment has you uncomfortable, step this downdraft aside and wait for a bottom to redeploy assets at much lower prices. The Ark complex along with other bubble names remain under heavy pressure as this is the most toxic environment imaginable for these names. Be careful out there.  Heading lower but with an eye on the the oscillators which are heading lower and will get over extended at some point.

SAXO Theme Basket Performance

Thursday and Friday we saw a resumption of the prior trend lower for payments, Bubbles, non-profitable, e-commerce, and China Related as Xi appears to have doubled down on Covid lockdowns.

Commodities

The industrial metals have taken a big hit on the demand fears propagating out of the China lockdowns. Bullish longer term but price wise in the short term these commodities and stocks will be under pressure ( FCX / AA / CENX / DBB )   THe Grains appear to be holding up so far in the commodity complex.

Macro Framework Spring / Summer 2022

Find the Blog Post HERE

Earnings Season & Bracket Trades

As earnings season kicks into gear, a reminder that this is prime time for Bracket Trades. Bracket Trades are those trades created when a stock gaps up or down from a news driven event. Bracket Trades are set up as “2nd day trades” where you alarm the high and low of the prior day’s trading range, then patiently wait for price to either break lower or higher from the range.  You then follow price out of the range. I will do my best to help identify them for you, but you can easily find them yourself by doing a sort for “GAP ups” and “GAP Down” on your trading platform.  I add additional filters for only stocks above $10 and at least 500,000 shares traded. You can add additional filters to cut down the sort further. Generally speaking, stocks favor continuing in the direction of the gap higher or lower.

You can find out more about Bracket Trades in the video Run the Player at 1.5x      HERE.

Bracket Trade Ticker Sort ( Gaps from Friday )   UA, GH, BILL, BE, ZLAB, LULU, WSM, SMG, NET, DISH, CYBR, COUP, SPLK, BIDU, DKS, HAIN, UNUM, NRG, PXD    Pick a couple to follow and add them to your list. 

 

INDEX CHARTS

Use the following pivots and levels in your active and swing trading. Added color is provided on the video.  Link above.

SPY Daily

SPY 2 hr

QQQ Daily

QQQ 1hr

IWM Daily

IWM 2 hr

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