19 – 23 October 2020 Trading week preparation

Every week I share a bunch of stuff.
– Daily signals for MA Crosses and MA breakouts
– Market Reports
– Consolidated market data and more.
https://eod-notes.com/shared-content/


From last week:
More choppiness, I took the week to connect again to the markets and keep my ear to the ground.

Earnings have been good, especially banks. Bringing back the ideas from last week, banks are a laggard and probably is the sector to be in for the next days.
Airlines earnings also started with an up kick from $UAL, from last week hint, It is also a sector to be in. Some stocks are at their lows. I can´t foresee the future for airlines, but I can foretell they aren+t going bankrupt anytime soon.

Still long the same positions $LVO.MI, $AG, and Gold (CFD).

Next Week:
More earnings, special attention to $T, $NFLX, $TSLA, $LUV, $KO, $INTC, $AXP, and $VZ.

Some stocks here may be a good buy, for example, $T is a great dividend stock and is trading at near March lows. Earnings will tell how this year went for $T and what to expect for 2020 last quarter.

It will be a difficult week to trade, between dollar strength and S&P choppiness, there’s a lot of indecision in the market.
One important thing to have in mind, and these can change all the bullish narrative is that Jerome Powell speaks tomorrow (Monday).

Earnings whispers

WTI
Last week WTI broke out from a downtrend.
Despite all the bullish news, cuts, storms, inventory withdrawals, and overall bullish sentiment, the price didn’t manage to break the $41 resistance.

I still think, as explained last week. All movements are connected to crude demand. Planes are in the ground, cruise ships are stationed on ports, people are working from home, etc. The demand isn’t there.

Technically, WTI is creating a nice trading channel.
My idea, wait and watch if it breaks the newfound trend line and rejects the top of the channel. The idea is to trade it down to the bottom of the channel.

Oanda WTI CFD

Gold
The technical setup on gold is as bullish as it can be.
It´s a clear breakout from a bullish pennant. That being said, the breakout didn’t convince me. It was very low key and rejected the nearest resistance.
Gold’s latest movements are very closely correlated to the dollar which is gaining momentum and strength.

I am very bullish on gold and silver long term, although I would like a retest on the yellow box.

Oanda CFD Gold
Market Gauge Gold Dashboard


SP500
The last two trading days were insane, the reversals on the end were epic.
Last Friday SP500 closed rejecting $3500, to be fair $3500 was my last week target for it, and from then I would expect a clear rejection.

If somehow we break the pattern, we could easily see $3200 (200 DMA). I sort of dropped my bearish bias because no one will let the marker drop, a lot. And some volatility is expected because of the up and coming US elections.

Be careful trading the SP500 the daily ranges are insane.

Oanda SP500 CFD
Market Gauge SP500 Dashboard

Dollar
I think that here lies the key to the market.
US markets keep being the most liquid and better yield market available globally and guess what, in order to invest in them, you need dollars.

DXY just broke out from the downtrend channel and If this continues to ride we can expect an equities and precious metals pullback.

Also, watch the correlation between the US10Y yield Vs Dollar. Higher yields and lower dollar = good for equities, and vice versa.

USD CoT
DXY

Other Notes
Sentiment turning bullish, again.

Market Gauge Sentiment Dashboard

Tape volume is stagnated.

Market Gauge Market Tape Dashboard

Interesting Articles

Events:
Check the full calendar here:
https://www.investing.com/economic-calendar/

Special notes on:
– Worlds Flash PMIs
– USD Fed Powell Speaks
– CNY Retail sales / Unemployment
– EUR Consumer confidence

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