Trade Plan 2/2 '22

Hey Traders -

Coming into the session today, I was bullish at 4480 as the OPEN was above 4480 PER scenario # 1. See trade plan below.

I was also bullish on AMD at 104, BABA at 125, GOOG at 2550 , XOM at 75. I was bearish PYPL at 175.

Close of DAY prices are S&P500 4550, AMD 122, BABA 127, GOOG almost 3000!, XOM 81 and PYPL about 145. Objectively, a good day for orderflow with a lot of plays working per expectation.

However we cannot rest on the laurels as there is lot more work to do. So without further ado, let us dive deeper into the session tomorrow.

Today I also share some thoughts on a couple earnings tomorrow. See last section. If you like this subscriber only plan, just like the one yesterday, feel free to share my newsletter so I can reach more folks with the message and the concepts of tape reading :)

A little background from today’s action before I string together some price scenarios for tomorrow.

My trade plan called for more pain to the bears due to recent price memory and called for 4480 to be the support. Low of the session was about 4476 before a rip into my target # 1 at 4516.

4516 target held the market in check for most of the session, and in last half an hour this level gave up. Smelled like someone had the $goog numbers. Anyways, Emini ended trading up to my target # 2. Closing the day at 4550 on strong GOOGL earnings.

GOOGL is a great example where I reiterated how bullish I was on this amazing company several times last week when the sell off intensified. I was so bullish on this stock at 2550-2600 and AMZN at 2700. The stock is now trading about 3000 after close and 3000+ on AMZN.

I digress again.

Tomorrow, now S&P500 gets a little complicated due to this stellar earning by GOOG unless there is some kind of macro event that goes down which makes the session easier to trade.

I think if Tic TOP SCRIPT OPENS strong and stays strong, GOOG GOOGL may trade at new ALL TIME HIGHS based on the ER today. And this may mean S&P500 could get a lift as well as GOOGL is one of the largest S&P500 companies by market cap! However, personally for me , I think if I missed GOOG at the lows of sub 2600 last week , there may be opportunities later this month to load it up rather than me chasing it here now at 3000 (or is it 150 now after the split 😉)

Absence of a macro event, I will be careful being short either S&P500 or GOOG until some sort of price confirmation is achieved. Read on below to find out what that may look like!

Then on other side of the ledger, PYPL is a cautionary tale. I was very bearish on this at 228 last year before Q3 earning. I was again bearish on this yesterday at 170-174 now it is down in dumps at 144! Ohh wow, so much destruction of PAYPAL longs. I will never go against my tape reading when it comes to these stocks. Thank God I was not in PYPL !

Now before going into the plan and levels for S&P500 emini, here is my personal two cent opinion and thoughts. The cream of creme of S&P500, the TOP 5 or 10 stocks are killing it with earnings. Their concentration is so heavy, like they are 40% of Nasdaq market cap that they are able to keep the indices afloat, while a lot of stocks on NYSE are in bear market.

Longer term I do not think this is sustainable. However I need to confirm this with orderflow. Like even today, I was a bit iffy on this rally. However if we can’t even trade below 4480, let alone 4456, then where is the confirmation? Once this short squeeze type situation resolves, I think volatility rears its ugly head again. Could be Friday. Could be Monday. Who knows! Until then I won’t do anything stupid like step in front of a freight train🤔

Levels and plan for tomorrow:

Before you read further, I ask that you read plan from yesterday to understand the context and background on where I am coming from. Thanks! Here is a link for you: OLDER PLAN

1. 4516-4520 may be key zone for me tomorrow. I will validate this with a strong read on TIC TOP indicator. Here is a link to the TIC TOP Indicator if you have not checked it before: INDICATOR LINK

2. If OPEN is above 4516 or goes offered above 4552 in IB, then I expect a test of 4566-4570 may be made. Upon/IF taking out 4570, momentum may take me to test 4584. For this scenario to pan out, I will need strong Tic Top read of 2/3 or more.

3. If OPEN or OFFER is below 4516, this will be a bearish event for me and a test of 4480 followed by 4456 may be made. At time of this post, S&P500 emini offered 4552. In this case, Tic TOP will record a weak reading at OPEN, progressively getting weaker.

4. Again to summarize, I do think there may be S&P500 headwinds in days and weeks ahead. However great earnings on stocks like AAPL and GOOG seem to delay the inevitable. For me myself, I will confirm this with orderflow levels like 4480 and 4516 which are going to be key going forward this week.

5. S&P500 last traded 4553 at time of this blog.

Earnings Watchlist for Wednesday

There are 2-3 earnings I have my eyes on tomorrow.

ODFL is one.

Freight companies have been doing fairly well what with COVID and supply chains and all. So I do not need to explain that part. One of my stocks that I shared at 53/54 is doing really well closing today at 68. That is ZIM.

I think ODFL itself may do well on earnings side, however if it really beats, I think ZIM may benefit as a proxy. ODFL BTW closed at 306 today. Due to the trade getting a little popular with every day folks and the fact that it does have growth characteristics , my LIS on ZIM will be tight, may be right around 53/54. But I think this stock may try 87-92 bucks if all goes per plan.

SPOT is another..

Last traded around 203, the company has endured a lot of controversy with its star Joe Rogan . In my own experience, controversy of any sort tends to be good, especially when coupled with revenue generation. Now is Joe Rogan controversy generating revenue for Spotify or not is any one’s guess. I for one have been listening to him non stop . May be even if it does, it may not show up on the books this quarter. So Joe Rogan episode may not even matter. May be not this quarter.

Regardless, what SPOT has going for it is recent resurgence in ARKK. It is ARKK holdings’ TOP stock (# 8) and has some tailwinds from that aspect as shorts cover. I think if it holds 196/197, it may have some more upside left. If it does beat earnings and the stock goes up significantly, it will be quite a milestone for the ARKK fund in my opinion. More on that later, if it works out. Will that work out if S&P500 starts crumbling? IDK. I don’t think so.

Now I will cover my thoughts on one more and then wrap it up.

FaceBook FB also reports tomorrow. It is trading about 327 after hours. See FB from my perspective is a different animal than let us say an AAPL and GOOG.

1. FB relies heavily on advertisements. And it is # 1 focus of AAPL privacy initiatives which tend to hurt more than help this ad business of FB.

2. GOOG in itself is an industry so we cannot compare GOOG ad business to FB ad businesss which depends on iPhone and iPad. GOOG has browser, it has Pixel, it has maps, it has YouTube. FB only has FB !

3. Of late FB is squandering it’s energy on the likes of Metaverse which remains a pipe dream. It is not even the leader in pipe dream, RBLX is! It has toyed with the idea of crypto and failed. It is now trying to monetize soft porn on Instagram . Biting on a lot at once.

4. While I did like FaceBook at the lows 290 last week, I am going to pass it at 328-330 due to these reasons listed above. It may also come under pressure if S&P500 decides to go below 4480 for whatever reason this week. I can have it lower at 266.

This is it from me for now. Subscribe to my newsletter for similar 5-6 posts every week.

Take care, Tic

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