Hey all, I’m back with another Sunday Prep where I work late into the night to prepare for the coming week of trading.
- BROADER MARKET
- LONG SETUPS
- SHORT SETUPS
- SPECIAL SITUATIONS
- EARNINGS PLAYS
$ES / $SPY (Daily)
$ES / $SPY (1D) daily shows that we are simply trending up the 20d nice and steady. The move has continued sideways for the most part allowing the 20d to catch up. If we hold last week’s lows I believe we can have another leg up soon. But if we can’t, we could be heading down to visit the low $4,100s.
$ES / $SPY (120 Minute)
$ES / $SPY daily showed a nice green daily candle on Thursday, but if we dive into the intraday, we quickly can see that Thursday didn’t look so hot till we got that V-shaped recovery midday. But then to turn around and give it all back on Friday really feels ominous. As stated earlier, really think it all hinges on holding last week’s lows.
$ES / $SPY (Weekly)
$ES / $SPY weekly really still helps to keep in perspective that we could still be in for a decent sized correction. Obviously we need to hold last week’s lows, but I don’t begin to really become cautious until we lose 4110.
$NQ / $QQQ (Daily)
$NQ / $QQQ right on the 20d here. Over last week’s highs and the trend is your friend. But we lose last week’s lows and we may probe down to around 13300.
$NQ weekly makes things much easier to see. Technically we broke to new highs last week, but not by a lot and we weren’t able to close above them. Under 13700 should trigger us down to retest the weekly 20 SMA.
$BTC even though we’ve reclaimed the 20d, this chart still looks broke to me until we are able to make new highs. Till then I’m watching for signs of this to be lower high. But if there’s any vehicle out there that constantly surprises, it’s Bitcoin/Crypto and the cult it’s built up.
Strong Stocks Looking for Continuation
$CROX had a nice beat on earnings last week and the stock has held the gains very nicely. Will look to buy any flushes towards the 95 area. Definitely possible we never see that low and will still monitor it if we test 97 area and buyers step in. Not going to hesitate to join trend on the name if the trade presents itself.
$UPS another name from last week’s earnings beats that has shown follow thru strength. 197 flush is where I want to be looking for scoops. If this name instead gets a few more days of climbing straight up, it very well could be a target for fade as well. But for now I think it’s a long on major flushes.
Oversold Reversion Setups
$TWTR the social media giant missed on earnings last week and the stock got smoked. Friday’s daily candle leads me to believe it might want to test lower still. How low? 200d? Possible. But let’s use some other timeframes for clues.
$TWTR weekly shows that this could have room to 48ish to retest the larger timeframe’s breakout area. These levels would really be ideal since it would be extreme enough to flush out even the shiniest of diamond hands first. If we get flushes into those kinds of levels, I will be there ready to relieve panic-stricken longs of their bags. But let’s also remember…
$TWTR (120 Minute)
$TWTR (120 Minute) …we don’t necessarily need to worry about how low it wants to go. We can clearly see which timeframe we are extended on (120m) and when the author is ready to take us back north, he will let us know. At the first sign of a failed short bias continuation trigger, I will be ready to pull the trigger on the long. Save the mental capital and avoid the guessing games.
$LITE is a slower name, but I missed it last time it came down to this trendline and not really in the mood to miss it again. But, with it being a slower name, make sure you understand that the idea on it is a swing. I would not be interested in day trading a name like this. 82 is where I’m interested, but under 78 and it’s definitely an “abandon ship” situation for me.
$LITE Monthly shows why. This could be the first lower high followed by a lower low that the name has had on such a high timeframe in quite a while. But the monthly ALSO shows something else. Another spot to possibly add if building into a swing. The monthly 20sma is currently 80.51. So my plan would be to take a starter at 82, add around 80, and ditch it under 78. Remember, tomorrow is the first day in the new month, so that 82 pivot will be replaced by the new monthly pivot (at $81.55) and there will be a brand new monthly candle as well. It’s the kind of trade where you can have rather small size on and once the trade confirms that we are on the right side, we can begin to add on the way up.
Weak Stocks Looking for Continuation
$HOLX this name almost landed on the “oversold reversion” list. That is until I looked at the monthly chart…
$HOLX (Monthly) – This bad boy just triggered a very high timeframe short and still has plenty of room down to the target. So flipping back to the daily chart we can start to look for the areas where we would be interested in joining trend. The new monthly pivots starting tomorrow will be 69.79 and 72.93. You can see the first one is right by the 200d which gives us some added confluence. That is the area where I would take my first shot at it. But I would most likely not ride it all the way up to the next level and instead would cut it if it showed the ability to reclaim the 200d and hold it. Afterwards my eyes would be looking for a push into the 72s for my next shot at the short. NOW, if this thing just pukes straight down to the target and never gives an entry (highly unlikely), I would at that point become long biased on the name and be scooping the living daylights out of this name.
Overbought Reversion Setups
$BNTX was on last week’s list for the same setup, but Monday morning it gapped down and took the trade away from us. Lucky for us, it found buyers and continued its climb higher. But after trading sideways for a few days last week, I want it to extend higher before looking to get involved. Just like the $TWTR idea from the long side, we don’t need to worry about guessing the top. Just need to wait for the author to clue us in that it’s ready. As long as she is making higher highs and higher lows, no need to play.
$VXRT is scheduled to present on Monday new data comparing the T-cell responses generated from its VXA-CoV2-1 vaccine with those of other vaccines. (12 p.m.). This is a complete sell-the-news event and it will be my main focus tomorrow morning for a fade on any extension.
Here’s this week’s lineup. $SPCE was rescheduled to next week.
$CHGG would be willing to try scoops around 80 if they miss, but if it can’t hold that level on the daily, I’m really not too interested till much much lower. Not saying it would go into the low 60s, but if it can’t hold 80 then I may flip bias to wanting to short pops as a way to join trend on what at that point would be a broken chart imo. If they beat and spike to ATHs, I would be looking to fade the initial push into those levels.
Monthly chart really cleans it up a lot.
$IRBT pretty straight forward. We lose this base it’s been building since last quarter, I’m either looking to scoop a flush around the 200d or short a pop back into the 108 level to fade it down towards the 200d. If they beat and it rips tits, I’m looking to short any spike into the supply zone in the 132-135 area.
$CVS is a smaller range name, but I like it’s chances of testing that next level higher (low 80s) if they beat on earnings and break out of this 77-78 area. Could either buy a dip to join trend or in the less likely case that it actually spikes straight up to the low 80s I would look to fade it.
Monthly once again cleans things up nicely.
$UAA I like the base it’s built. If numbers are good I’m either fading a hard spike up into the 27 area or I’m looking to join trend long on dips vs 25.
$SKLZ (120 Minute)
$SKLZ notice how that LVN (low volume node) lines up almost perfectly with the 50d AND the area where the breakdown occurred on 3/24. If we spike to those areas off the numbers I will definitely be looking to fade the move.
$ATVI I’m either a scooper around the weekly 50 SMA or I’m shorting a spike to ATHs. If it wants to spike into the midpoint range between where it’s currently trading and ATHs, then I very well may look to join a trend buying dips against that 98 level.
$LYFT got hit last week on headlines about the US pushing for gig workers possibly being considered employees instead of independent contractors. Notice that it held some VERY key levels.
Would be willing to try scoops off the 200d if it flushed there. Also game for fading a hard shove into the high 68s. But if it breaks above those highs and shows the ability to hold, may become a trend-join trade. Really will depend on the reaction to the numbers (DUH, as if all these ideas don’t)
$PYPL still very interested in the swing idea on dips at the long term trendline. Earnings may just be what gets us down there. It also may be what makes it so that trendline is a pipe-dream. Doesn’t mean you can’t participate on the long side if they gap up. Anything over 278 and I would look to buy dips against that breakout area.
$ETSY has had a nice consolidation period after quite the move up. If it loses the 190 area, I think we might get a nice opp to scoop it off the lower trendline. Will have a monthly pivot and the 200d around the same area, so plenty of confluence. If they beat, I will be looking to join trend on a gap up.
$UBER loses 50 and it should see 46-47 imo. I like those levels for scoops with all the confluence there.
$PTON has been acting extremely bearish. I own it in my SEP account from quite a bit higher, so it’s not like i’m rooting for lower prices. In fact, I would love to see them beat and maybe have some constructive price action over the next few weeks to get things looking a bit better. But they look like absolute garbage right now. Under 92 and she could go tumbling. As far as a day trade is concerned, would either be a buyer if it flushed hard down to the 72 area, or I would look to short a pop back into the 92 breakdown level.
$SQ under 240 could send her tumbling down towards the 200d. I don’t mind trying scoops on a flush to 200, but higher timeframes make me VERY VERY wary of a 190 break.
Monthly shows just how broken this becomes under that 190 level. Could want to wander down to the monthly 20sma. Worth noting that when we start getting into these much higher timeframes, there is ZERO expectation that these play out quickly. In fact, it’s quite the opposite. The higher the timeframe the setup, the more time we have to look for entries that fit our risk profile.
$ROKU anyone that has been following my Sunday Preps for any real length of time will remember how bearish I had been on ROKU. She finally rolled over and gave quite the retrace. She’s since found some support levels and has begun to attempt to form a higher low here. But last week’s candle was really ugly for her. She rejected directly off the underside of that 20sma on the weekly. Now if she loses that 336 area, could be a fast-track down to the 290s. However, IF she actually can break above 400 and get some legs higher, I would love to entertain a fade in the 440 area. Patiently waiting to see the market’s reaction to these numbers. I know as well as anyone that opinions aren’t worth shit in the stock market. But $44b marketcap on a cash flow negative behemoth just seems nonsensical to me.
$NET Notice how she just recently triggered the long setup that should take her to ATHs? So even a miss on numbers may present a nice swing trade dip-buy opp with our risk defined.
Daily chart shows the spots where I would take my shots for the long. 20d lines up perfectly with a retest of the breakout spot from the original long trigger. If it were to gap lower than that, my eyes are on the 70 level.
$BYND chart really looks in danger of losing some levels. On the weekly we keep rejecting the underside of the 20sma and the 20sma is now crossing under the weekly 50sma. If it can’t hold 123ish, could send it cascading.
Daily chart doesn’t make it look any better. We are under the 200d and the 50d recently crossed under the 200d. Even if it loses 123, 113 is the true last line of defense. There will definitely be the sound of drums playing as the numbers for Beyond are released.
That’s it for charts. Again, I know it seems really long and overdone, but that’s just the way things need to be done when so many big names have numbers coming out. I will leave you with one final note about some observations from last week: We saw a TON of the big names come out with stellar numbers and then get absolutely shit-canned. If this theme bleeds over into this week as well, I will start being a bit more cautious on the long side. Remember last week what we said…
That definitely wasn’t the case last week. Maybe things will change this week. But they will need to show me that they are indeed changing or I will start to look to fading all big gaps into levels. Hope you all had a great weekend. See you bright and early tomorrow. Peace.