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Swing Trade Idea – January 25, 2023

Positive – Negative – Neutral

Market Setup Pre-8:30 AM ET

Global Markets:  USA, Europe, Japan, Asia –  Negative global set-up

•Commodities:  Gold, Silver, Oil and natgas, Grains, Industrial Metals

•Yields: Yields are lower

•Currencies:  US$ +.1%, Euro -0.17%, Yen +0.28%, AUD +.32%

News:  USA: quiet Canada: Rate increase today UK: PPI output -0.8% m/m  AUD: CPI y/y 8.4% vs 7.6%

Stocks: MSFT -2.6% with a lower growth forecast. Azure, advertising, and PC are lower. ASML -2% displays guidance guarded with BA -1.4% losses improving; GD +.87% display a beat; TSLA -1.2% earnings are on tap  ENPH -1.5% displays a downgrade target of $255; T +2% displays a beat; ADP -1.5% displays a beat; COF -2%  shows a downgrade and ISRG -9% shows a miss

General: Leading: Bonds, Brazil, and US$  Lagging: Spec tech, bitcoin, faangmt, Gold miners, software, and semis

Indices: USA indices are lower led by the Nasdaq. The macro setup is slight with a risk-off, bonds higher, and US$ slightly higher with global equities lower. SPY 397 has the support of 395 and 390 with a resistance of 398 and 400. QQQ 285 has a resistance of 290 with support of 283 and 280. MSFT:  Azure guidance is negative for AMZN; weaker PC displays a negative for AAPL, AMD, INTC, and NVDA; there is weaker ad revenue, displaying a negative for GOOGL.  Market posture is risk-off and with the market underhedged, there is potential for a trend down if the QQQ < 285 and/or the SPY < 395. In my analysis I will watch the US$, currently, it is not signaling major risk. DXY > 102.4 is a warning level.

Stocks to watch: T, TLT, MSFT, NVDA, AMD, ASML, ENPH, ISRG, COF, AAPL, TSLA, BA, Spec Names: SARK

Pre-800ET

Earnings: CNI, COF, MSFT, ABT, ADP, APH, ASML, BA, ELV, EXTR, FCX, HES, KMB, NDAQ, NEE, NSC, PGR, T, TEL

Indices: TLT, EWZ, UUP,  ARKK, /BTC, faangmt, GDX, IGV, XLK, QQQ, SOXX, SMH, XLY, ICLN, GLD, XBI, XLB, KWEB

S&P500: NWS, T, PM, ISRG, ENPH, MSFT, AMZN, NOW, NVDA, AMD, COF, CRM, DHI, ADBE, TSLA, DIS, AMAT

IWM: LBRT, T, SPWR, TAN, PACB, CAKE, AI, PLUG, BLMN, FRO, NOVA, APPS, SAVA, NTLA, LTHM, MSTR

WSB: NET, AFRM, COIN, AMZN, PLUG, RIVN, UPST, PLUG, AMD, NVDA, TSLA, MSTR, NIO

Movers: NWS, T, PM, ISRG, SPWR, RUN, SQ, CAKE, ENPH, W, ABNB, NET, SNOW, U, SBSW, DDOG, AFRM, MSFT, COIN, CRWD

My Trade Idea: QQQ
QQQ is weak post weak MSFT guidance which is impacting the technology sector. QQQ premarket is currently below the 285 gamma level and while below targets to the downside are 283, 282, and 280. I expect a short covering bounce at open which may be fadeable if the price < 285.