Daily Profit Compass July 8

Tickers discussed: SPY QQQ IWM  FB AAPL AMZN MSFT GOOGL  TLT GDX MOMO WYNN   Strategy & Tactics

The Daily Profit Compass provides the stock market analysis for the day. Key levels and trading locations for the indexes are provided, along with trading plans and timely commentary to keep you on the right side of the trade.

Trader’s Couch 

Know why you’re selling

A common problem that has come up in our Mentorship Workshops is selling micro winners before they’ve had a chance to run.  We need good sized winners to cover all the trades where we’ve been stopped out, so selling marginal winners becomes a problem. Our baby wins don’t cover our losses. The root of the problem is the fear of losing. We are so happy to see green there is a a want and need to book the win before it goes against us. Try this approach the next time you feel the need to sell a winner…ask yourself “Why do I want to sell?”   If the reason is tangible like price broke a trend line, lost support,  or other technical factor, that is fine. But if you go through the technicals ( or whatever your process says ) and all you are left with is “I’m scared the market will turn”, power through that feeling and leave the trade on.  If you do that, I think you’ll see more substantial winners and your overall profitability will improve. 

Earnings

News Flow

  • Florida’s covid positivity soars; US planning a testing push
  • NYC commercial real estate pushed to the brink by no-payment by tenets
  • A recent survey by creditcards.com  suggests consumers plan to dial back spending just when the economy needs them the most.
  • AAPL is 43% of Berkshire’s portfolio. A staggering number.
  • Zuckerberg fails to impress critics after meeting those demanding content controls

Market Snapshots

Probably can’t go on forever.

 

FAAMG Micro Cracks

Yesterday afternoon we saw all the FAAMG names break their steep 1 hour trendlines. Of course the Q’s followed lower into the close. Now we’ll see if the micro dipsters will rush in to buy this baby dip. I favor a bit more of a dip but thus far, no reason / evidence to believe we’re in for anymore than that. We have a gap below to fill on SPY and QQQ. If you see price fill those gaps and move below them, then there would be a tangible reason to think more downside ahead. Let’s continue to go level to level. Today, focus on watching hold those FAAMG behave.

 Strategy and Tactics – Short term, leaning towards lower

  • We have clear levels to watch / trade against with gaps below both on SPY and QQQ.
  • On SPY, key off $314. Below is bearish and favors a gap fill.
  • Again, VIX and VXN were green BEFORE the afternoon fade. Somebody has been laying on protection.
  • Eye’s wide open though trying to keep open and flexible to new data and inputs.
  • Expecting a hi-vol summer with Covid and political headlines whipsawing markets
  • I realize its difficult, but don’t lock it on an idea or thesis. Stay open and flexible in your thinking. Let price be our guide. Stay mentally flexible here.

FAAMG Live Annotated Charts

Annotations updated July 6

Click on the Links to view my annotated live charts

FB                  Daily

AAPL            Daily

AMZN          Daily

MSFT           Daily

GOOGL       Daily 

$TLT

AFter zooming to the top of the range yesterday, price now at a critical juncture. Resistance is resistance until broken but if price pops $165.20 and can hold it, the breakout promises a $3 upside move. Worth an alarm.   Any weakness in stocks would help a long trade here.

$GDX

Nice breakout yesterday. IMO anyone not already long can be long against $37 which should be good support. I like the posture of price above all the bullishly stacked ema’s.  I think this grinds higher. Seasonality in July and August are positive for GOLD.

$WYNN

$70 is a key level for WYNN. Price currently testing its trendline and is still somewhat constructive. That said, I am setting an alarm at $70. THis is the key location for either a long at support or a short if it breaks.

$MOMO

This beaten down China name is coming out of a divergent low which is bullish. I like this long on a break above $21. T1=23.50  T2=26   If china names continue to see bids, this one may be primed for a lift.

Index Chart Review

SPY 2 hour

SPY 30 min

QQQ 2 hour

QQQ 30 min

IWM 2 hour

IWM 30min

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