Trading the Charts for Thursday, August 17th
In order to read this entire newsletter you’ll need to become a paid subscriber by clicking the button below. Paid subscribers get full access to my trading portfolio (up ~62% YTD), daily watchlists, daily activity (buys, sells, entry prices, stop losses, performance), daily webcasts/recordings and my options portfolio.
I also run a Stocktwits rooms where I post about my investment portfolio (up ~98% YTD and ~1,000% over the past 3-years) with full access to all holdings, performance, daily activity, market commentary, quarterly earnings analysis, daily webcasts and more.
Here are my deep dive newsletters…
Good morning and Happy Thursday,
We get a few more earnings reports that could matter like WMT this morning, BILL and AMAT this afternoon then DE and PANW on Friday
Markets are not liking the rise in yields, yesterday the 10Y hit it’s highest level in 15+ years, personally I think we’re close to the top in yields and we see them lower in 6 months but hard to say what happens in the short term especially with the hawkish FOMC minutes yesterday and Jackson Hole Symposium next week at wish Chair Powell will likely focus on “higher for longer”
I’m also keeping track of the companies with the best reactions to their Q2 earnings reports because once the markets finish pulling back, it’s those stocks that should outperform over the next 2-3 months into Q3 earnings.
However, with that said if yields do start to pullback you could see growth stocks pop higher but most of them need to push through alot of resistance and overhead supply so I’d rather stick with the stocks that are still above their KMAs (key moving averages).
We’ll start with yields because they are turning into a significant headwind for equities, especially growth stocks and small/mid caps. I don’t think the markets can bounce without yields pulling back.
Probability of another FOMC rate hike in September is ticking higher…
Futures in the green as of 6am EST…
All of the indexes finished in the red yesterday with tech, growth, small/mid cap looking the worst. They all bounced mid day but faded hard after the FOMC minutes were released which were hawkish so we saw an acceleration in selling into the close so all the indexes closed at their lows of the day…
Utilities was the only sector in the green yesterday, when that happens you know it’s a “risk off” day.
SPY down -4.3% from the July high, closing below the 50d ema yesterday, not sure where we find support on a further pullback, perhaps 437.13 or 431.27
QQQ down -6.6% from the July high, also slicing through and closing below the 50d ema, if we don’t bounce off a VWAP then 357.70 might be support
IWM down -6.5% from the July high, slicing through the 50d ema/sma this week, now trying to hang onto the 100d ema with 200d ema just below.
ARKK down 19.7% from the July high, slicing through lots of support along the way, now trying to bounce off the 41.27 pivot and the VWAP from March low. I’ve been shorting ARKK for the past 6 weeks as a hedge but I finally covered that short yesterday when it looked like ARKK was bouncing off the VWAP from March low, if ARKK closes below that VWAP then I’ll put the ARKK hedge back on.
Below the paywall is my current trading portfolio including all positions (open & closed), watchlists, entry prices, stop losses and YTD performance and my daily webcasts.