Daily Profit Compass Jan 20

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Tickers discussed: SPY QQQ IWM FB AAPL AMZN GOOGL MSFT NFLX TSLA

The  Daily Profit Compass provides stock market technical analysis for the stock market today and is 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 

Earning season kicks off in earnest this week.

Tuesday – Follow up on Big Banks with GS & BAC reporting with NFLX reporting after the bell which could and often is a sentiment gauge for mega cap tech.

Wednesday – PG should give a decent read on the consumer; FAST in the industrial space; UAL first airline to report; plus a slew of other regional financials

Thursday – INTC may provide color with new CEO in place; CSX first in rails and PPG industrials and yet more regional financials

Friday – SLB bell weather in oil services

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

News Flow

  • The inauguration of President-elect Biden is today
  • Sources say Biden’s first day on the job will be busy with him undoing as many of Trump’s policies as possible via executive orders
  • Market cheers Treasury nominee Yellen’s  confirmation hearings
  • Jack Ma, Alibaba and ANT Financial founder, spotted in China and he is alive.
  • BABA has spiked in premarket trading

Big Cap Tech Wakes up

  • for the first time in a long time, big cap tech showed some spark and pop.
  • Led by FB and GOOGL both up over 3%
  • After the bell, NFLX impressed with its earnings report and outlook. Catching many by surprise, CEO said the company is now in the position to no longer need to raise monies for operating expenses as the business goes cash flow neutral in 2021 and set to be cash flow positive in 2022.   Shares were up 13% in premarket trading.
  • Now its all about follow through.  Does mega-cap tech regain a leadership position in the market or revert to the sogginess we’ve seen the past 4 months?

Focus on Netflix

The key for Netflix is for price to recapture and hold the $560 level which was the top side of the prior $90 trading range. If it can hold the breakout, the measured move technical target would be $650.  Stay open to the possibility of a gap fill below. That gap is $60 wide and represents just as big an opportunity as does the long side.  $560 truly is a binary spot for the stock.

Trades about to Happen

On a separate post this morning, I offered up 9 trade idea set ups for your consideration.

If you missed it, you can find the blog post HERE

FATMAAN Names

In the companion video, I cover off the FATMAAN names using the daily timeframe. Some very interesting trade locations are on the horizon that will set up well for swing traders on the daily time frame.

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

SPY 2 hour

SPY 30 min

QQQ 2 hour

QQQ 30 min

IWM 2 hr

IWM 30 min

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