Weekly Market Review and Swing Trade Opportunities, February 5th, 2024

Hi all,

Markets rose again for another week but not without a lot of drama and volatility. On Tuesday, we got earnings reports with AMD, MSFT, and GOOGL all of which sold off on the news. Fed chair Powell caused a big sell-off Wednesday when he poured cold water on trader’s belief that they were going to be starting to cut rates in March.

Thursday the markets shook off the Fed news and bounced back a little. Then META released its results after the close. They reported numbers well above expectations and the stock price took off.

Friday's jobs numbers and wages also blew past expectations with payroll and wages coming in almost twice what was expected. The first reaction was good news was bad news for the markets (even more reason not to cut rates) but Friday ended strong as investors and traders reassessed whether the jobs data was bad news or was actually good news. Economy continues to be strong and consumers keep working and spending.

More earnings next week. There should be more volatility as well.

Recap Video

Watch the recap on YouTube

Sectors in Play Last Week

• Consumer Discretionary and Staples sectors were the biggest gainers this week.
• Energy sector was the biggest loser of the week.

Key Levels for this Week

• DOW (38,654) – support 38,000 and resistance 38,800
• QQQ (429) – support 415 and resistance 430
• SPY (494) – support 480 and resistance 500
• IWM (194) – support 190 and resistance 200

What to Watch for this Week

• Monday – 9:45 S&P US PMI services, 10:00 ISM services
• Tuesday – 12:00, 1:00 and 2:00 Fed speakers
• Wednesday – 11:00 to 3:00 Fed speakers, 3:00 Consumer Credit
• Thursday –8:45 Jobless claims, 10:00 Wholesale Inventories
• Friday – 8:30 CPI seasonal factors

Earnings this week

• Monday – MCD, CAT pre then PLTR, VRTX, NXPI post
• Tues – LLY, SPOT, BP pre then SNAP, F, ENPH, CGM post
• Wed – BABA, UBER pre then DIS, ARM, PYPL post
• Thurs – CCJ, COP pre then PINS, AFRM, NET, TTWO post
• Friday – PEP, ENB pre

Tracking

• AAPL – Earnings release negatively impacted stock but came back strong Friday. Will be supported by the coming AI initiatives they finally mentioned. $190 initial resistance and $180 support
• AFRM – Closed put position for profit when it dropped below $40 and in advance of earnings this week. Now wait and see.
• AMD – Sold off after earnings release but came back up. Around $181 is resistance now.
• AXP – had earnings and still looks strong with $200 support. Could sell puts and even buy some upside calls with money.
• BA – Holding long some long-dated calls. Bought $240 and sold $260 to reduce cost of trade. Monitoring.
• GOOG – Negative after earnings release this week. Support at $140 and could bounce back.
• IBM – looks toppy after earnings. Sold $195 calls that expired worthless on Friday. May look at selling more upside calls next week.
• INTC - $41 looks like support. Could buy here with a stop or sell puts around that level.
• META – Blow out earnings report. Wait and see where it goes next week.
• NFLX – Continued strength after earnings report. $580 looks like resistance.
• TSLA – Very weak after earnings release but might have put in a temporary double bottom pattern.

Positions

• GOOG – long some $145 calls expiring Friday.
• BA – long vertical call spread $240 x $260 expiring August.
• AFRM – Long $36 puts expiring June. Sold on drop below $40 Friday in advance of earnings.
• IBM – short $195 calls expired worthless and kept premium.
• TSLA – long $180 puts – may have to sell based on early week price action.

 

Note: These are investments I am in or watching however, they may not be suitable for all investors. The author of this email is NOT an investment advisory service, a registered investment advisor, or a broker-dealer and I do NOT undertake to advise clients or recipients of this email on which securities they should buy or sell for themselves. This email is provided for information purposes only and traders should always consult with their licensed BIDO financial advisors and tax advisors to determine the suitability of any investment.