WEEKLY GAME PLAN May 21, 2022

Welcome to the Weekly Game Plan! The 'MARA Lists' are updated in real-time. The 'Market Summary' is provided weekly. The 'Deep Dive Video' is the recording of our weekly Trading Prep DEEP DIVE.
MARA List

Market Summary

MARKET MOOD: Red

Since November 17, the market has been in a ‘RED’ condition in all but 16 days.

The summary below is my interpretation of the data in the ‘Market Mood Log’ above:

  • Indexes testing major support: Each of the major indices are approaching or testing major support. See ‘weekly’ charts below. This is after being down 7-8 weeks in a row. Its beginning to get closer to where a bounce is more and more likely. Sharp rallies can occur in bear markets as shorts scramble to cover
  • New Lows remain in the triple digits: The last time the NASDAQ had a slightly positive outlook for new highs vs new lows was early April. This week saw triple digit new lows with a very brief trip to the high double digits. Keep in mind that any sustainable rally will be accompanied by a sustained drop in new lows.
  • Distribution climbed to 5 over last 10 trading days: The distribution count is as heavy as we’ve seen it all year. When the indexes got close to the 21ema on Wednesday they were met with heavy selling. Monitor the price action and the indexes for more distribution.
  • There are 35 stocks total on the trade ideas list. There were even 3 gauntlet worthy ideas and 2 of them CNQ and VRTX scored above a 7 and were added to the action list. The market is far from anything I’d consider healthy, but having a few quality setups on the board is better than what we’ve had the last 2 weeks.
  • Open Trades: I’m still long MRK. It was a little slow out of the gate but now that its left the station its been behaving well. It has hit 1 scale out and my full stop is at breakeven.

HOW I’M PLAYING THIS HAND: I’m placing orders for both CNQ and VRTX. As quality setups emerge, I like to put orders in and let the market decide what gets executed. EQT is another one that is high on the radar but not quite ready yet. It’s setting up in a high tight flag. We discussed this one at length during the trade ideas session.

Checkout the charts of the indexes below.

MONTHLY CHARTS (indexes) Over all Direction = Down: https://www.tradingview.com/x/I24H09BG/

WEEKLY CHARTS (indexes) Over all Direction = Down: https://www.tradingview.com/x/LOoHLVjx/

DAILY CHARTS (indexes) Over all Direction = Down: https://www.tradingview.com/x/hG3qzJr8/
(on the lower right is FFTY, the ETF that tracks the IBD 50)

MARKET MOOD REVIEW

LESSON

Elite Members go to Elite Training or click here for ‘Rocket Bases’ (Stu)

TRADE IDEAS

Trade Ideas, setups for the week ahead and group discussion (Mike)

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