On Friday, earnings winner ADSK and earnings loser FL provided perfect trading opportunities. Unfortunately, WMT and CBI both rallied on a gap up while we were only interested in joining a trend on a gap down. Overall, though, we were able to profitably conclude an eventful week.
At this time, there is no A+ setup for tomorrow available yet. We will have to wait and see how tomorrow’s pre-market trading turns out. Here are the best setups which we consider trading tomorrow morning:
ADSK has seen a big gap on its already extremely strong daily chart. Since we didn’t see any kind of power close on it, any short idea should be treated cautiously. If we see a slight weak open and a remount towards the $111.70 area, the plan is to join a confirmed long trend. On a gap up, however, we will avoid trading the stock.
NVDA remains an overly strong stock. After we saw some profit taking on Friday’s big gap up which was triggered by a price target increase, the plan is to join the buy side strength on any weak open for a red to green or even $140.00 move.
After last weeks SPY unwind, the overall market saw an increase in fear and therefore an increase in volatility which sent UVXY straight up to the $16.00 mark. After the market bounced back nicely on Thursday and Friday and UVXY dipped back alongside with it, the idea is to join a weak open for a red to green move for a slight bounce move. Important to note is that the plan is conditioned on SPY showing a whiff of weakness.
Friday’s biggest earnings loser gave us a solid all day fader setup. Since the overall intraday unwind is more or less reasonable and not too oversold, the idea is to join another leg down after a slight gap up push and fail. However, if we gap down significantly, it might also offer a relief bounce setup long. Hence, FL should be traded reactively.
All throughout May, NBR has built a superb base in the $9.50 to $10.50 area. As the stock trended all day long last Friday and finished the day with a strong close, we will look for a $10.50 breakout to join the long trend once the $10.50 area has been confirmed as support.
Nice daily chart that offers plenty of continuation plays on the overall uptrend. We saw a big push towards the $45.00 magnet last week. After retesting the $40.00 support area and pushing back up last Friday, the plan is to join any weak open for a red to green continuation move for a $45.00 retest or even breakout.
EXEL has shown enormous weakness throughout May. After Thursday’s relief bounce, the stock was sold back down on Friday to a major support level in the 52 week chart. We will wait and see how the $19.50 area supports the chart. The plan is to look for a gap up (if any) and continued weakness below the $19.50 price level to join any confirmation below this point.