Good morning fellow traders,
After a disappointing start to the day, the $QQQ and $SPY filled most of their previous gap before starting to rebound. The FED minutes came in line with expectations and helped the indices recover early losses and push a bit higher than the previous day. It is still difficult to anticipate the next big move from these levels, and therefore day trading is the best approach for now. We are still in a pretty tight range with both bulls and bears unable to take full control. The Russian factor continues to influence the markets, as reports came yesterday that more troops were actually added on the Ukrainian border.
Futures are currently down small. $NVDA reported good results last night and guidance, but the stock slipped lower in after hours as this is a high P/E stock. $GOOGL dropped a bombshell yesterday morning as it announced a similar policy to $AAPL which affects directly $FB. The social media company drifted lower than its current pivot but managed to reclaim it throughout the day. Still broken, but getting cheaper by the day.
For today, our focus will be on managing our current positions. We are still long $AAPL and added a few calls for $AMZN which showed good relative strength in the afternoon. Similarly, we have some $TSLA calls for Friday and we added on the lows today. Given the overall picture and the current headwinds it still seems that the path of least resistance is to the downside. $ABNB and $UPST were good options trading strategies for our portfolio and we managed to exit for a nice profit. We are less invested going into today than yesterday, and will continue to remain tactical.
The overall market filled most the recent gap before reclaiming early losses. Still in no man’s land here with both bulls and bears trying to get some momentum. In order for the active bulls to show some commitment to the recent bounce, we need a move above $450. For the bears to push the market lower, a break of $440 is needed.
The tech sector was weaker throughout the day before the FED minutes came out. It managed a decent bounce on news that the FED will stay the course despite higher than expected inflation. For today, with futures down, see if we hold $350-352 and continue to rebuild. The big resistance area ahead if $360. Keep in mind that this Friday we have the monthly OPEX which will add a new layer of volatility.
$TSLA was weaker than expected but managed to stay above $900. We exited our stock position but added to our $950 calls for this Friday. For today, it needs to defend $915. The next resistance area is around $945. Big day ranges, so make sure that you trade a small size with clear entry and exit areas.
$AMZN continues to hold its earnings gap and acts better than expected. It showed good relative strength throughout the day. As an option play, we bought some $3180 calls for this Friday in case the tech sector pushes higher. Difficult to trust here, so do not get over your skies going long. $3180 and $3220 are the next resistance areas. It is building a wedge type pattern, see if it manages to get above it.
Bitcoin continues to build inside the inverted head-and-shoulders pattern. We added to our position yesterday on weakness and our next buy-level is if and when we get a move above $45K. We advise being tactical and watching the overall action in the indices before committing to any new longs. Difficult to be in a portfolio approach and one has to adapt to the new market conditions until better set-ups present themselves.
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