Earnings, Interest Rate Decision, and My top 5 charts to watch.
The Most Anticipated Earnings week of July 25th, 2022
These are the companies I am looking forward to reading on their earnings:
- Tuesday: $UPS, $KO, $GM, $MCD, $GOOGL, $GOOG, $MSFT, $V, $CMG
- Wednesday: $SHOP, $META, $BA, $WM
- Thursday: $AAPL, $AMZN
These companies will provide excellent insight into how consumers spend their money! With inflation being the number one concern in recent days, even in recent months, the main focus for the year’s second half is “can the consumer continue to consume.”
Companies such as Amazon and Shopify allow consumers to buy goods/ products online. United Parcel Service ($UPS) connects these products between seller and buyer. Meta’s and Google’s earnings reports will give us insight into how businesses spend money on ads. The higher the ad spend, the more companies anticipate consumer spending in the upcoming quarters. The lower the spend, the less money they anticipate consumers to spend. Visa is the backbone that allows money transactions to go through.
Looking at our upcoming economic calendar, we have the following: New Home sales on Tuesday, Durable goods, and Fed interest rate decision on Wednesday.
Facing inflation that keeps soaring to new peaks, the Federal Reserve is slated to raise interest rates again Wednesday to fight it.
I believe we will either get a 75 or a 100 bps increase. Investors seek clarity from the fed, so once they raise rates this week, tone into their press conference.
You can read up on why this matters on our previous blog. FOMC and Rates and Fed Funds Rate and 5 economic forces behind the Fed’s next rate hike decision
My top 5 stocks to trade going into this week
SPX, weekly timeframe shows us a change in momentum from bearish to neutral.
- The weekly candle closed around $3,965.1 (could go either way)
- The weekly candle closed above bove the 5 and 9-day exponential moving averages ( bullish )
- The weekly candle closed above the upper downtrend line (bullish)
- The weekly candle closed below the 20-day exponential moving averages (bearish)
SPX 4hour time frame shows signs of a pullback, a rally, and another sell-off.
- For the below chart I used the 14-day and 30-day simple moving average. 14 day is blue and 30 day is orange.
- As long as SPX stays below the $3,965 level, we can anticipate sellers to be in control.
- Ideally on this time frame – went to target the 14-day SMA and then the 30-day SMA, below $3,965 target $3,902.
- Depending on the strength of this move or even so when this moves happens ( keep in mind big company earnings are being reported this week and FOMC), we can bounce around $3,902 back up towards, $3,965.
- Below the 14-day SMA, we will continue to sell off, $3,860 is possible this week.
After a good earnings report, Tesla’s trading range increases yet again! Get ready for some crazy short and long trades.
TSLA, weekly candle – we can either jump up towards $900 or come back down to $763 – gotta love it.
- The weekly candle closed below $837 (bearish). We could see this turn out to be a double top and cause the stock price to return to $800.
- I have the range between $820 and $816 to be considered “premium burn” – where price action will just be consolidating.
- I would personally wait for a clear entry to short: Price closing below $816 and below the 5-day and 9-day EMA on a 5 min or a 15 min candle and target price would be $810 / $800.
- I would personally wait for a clear entry to go long: Price action closing above the $820 price level and above the 5-day and 9-day EMA on a 5 min candle. The target price will be $832 /
Tesla, $TSLA 4hour time frame
- If the stock price falls below $800, we can see the price coming back to $763 / $753.
- I am personally looking to short NVDA once again after seeing price action reject the $181.58 level.
- I see a potential head and shoulder pattern forming on the 2hour and 4-hour time frames. (see below)
- Ideally, I would like to get into puts once the price action is below $171.38.
- The entry for this trade will trigger when using the 5 min or the 15 min timeframe, price closes below the 5-day and 9-day EMAs.
- I personally like the $165 puts for July 29th or the $160 puts for August 5th.
NVDA here is the head and shoulder I am seeing.
Read more on how to trade this pattern here: The Best Chart Patterns for Trading