Trading Plan for Wednesday, May 8th, 2024
Trading Plan for Wednesday, May 8th, 2024
Market Sentiment: Bullish, but increasingly cautious in the overbought market. Consolidation is ongoing, and a deeper pullback is likely before further advances. Maintain disciplined risk management.
Key Supports
Immediate Supports: 5209 (major), 5202, 5188-91 (major)
Major Supports: 5143-36 (major), 5067-69 (major),
Key Resistances
Near-term Resistance: 5224 (major), 5246 (major), 5265-70 (major)
Major Resistances: 5302-06 (major), 5328-30 (major)
Trading Strategy
Post-Breakout Dip Anticipated: The market is overdue for a healthy pullback after the recent strong surge.
Long Opportunities: Focus on failed breakdowns at 5202 or 5188-91 for long entries. In the event of a deeper pullback, consider buying the retest of the breakout zone at 5143-36 or knife-catches at 5168 for quick scalps.
Short Opportunities: Look for back-tests of 5246 or 5265-70 for short entries, targeting level-to-level profits. Proceed with extreme caution and be ready to cut losses quickly. Remember, shorting against strength in a bull market is inherently risky.
Focus on Levels and Patience: Trade the provided support and resistance levels rigorously. Let price action develop, be patient, and avoid emotional trading.
Bull Case
Holding Support: Defending the 5143-36 breakout zone remains crucial for maintaining bullish momentum. Holding above this level would indicate a healthy dip and a potential continuation higher.
Rebase and Bounce: A period of consolidation around 5190-5224 and a rebound off these supports would set the stage for further advances, potentially targeting 5246, then 5265-70.
Bear Case
Breakdown Signals: A convincing break below 5188-91 would signal a potential pullback and could lead to a retest of the 5143-36 breakout zone. Monitor bounces/failed breakdowns at these levels for potential short entries.
News: Top Stories for May 8th, 2024
Global Stock Market Trends:
Varied Performance: Asian markets show resilience despite Nikkei 225 drop, influenced by mixed corporate news.
U.S. Economic Indicators: U.S. jobs report and Fed's interest rate decisions continue to influence global markets positively.
Geopolitical Tensions: Market responses to geopolitical unrest remain muted, highlighting diversified global economies' resilience.
Company Earnings and Forecasts:
Earnings Performance: Uber reports Q1 loss; Thomson Reuters shows strong revenue growth.
Financial Forecasts: Taboola expects significant YoY growth; Thomson Reuters adjusts full-year outlook.
Sector-Specific Insights: Technology and financial services sectors demonstrate strong growth potential despite operational losses.
Analysts' Perspectives:
Setting Market Expectations: Analysts forecast earnings based on economic indicators, trends, and company guidance.
Implications for Investors: Earnings reports influence market sentiment and investor confidence, impacting stock prices.
Impact on Currency Values:
Political Events: Geopolitical tensions historically impact currency fluctuations, yet recent responses remain subdued, reflecting diversified global markets' resilience.
Market Sentiment: Bullish, but increasingly cautious in the overbought market. Consolidation is ongoing, and a deeper pullback is likely before further advances. Maintain disciplined risk management.
Key Supports
Immediate Supports: 5209 (major), 5202, 5188-91 (major)
Major Supports: 5143-36 (major), 5067-69 (major),
Key Resistances
Near-term Resistance: 5224 (major), 5246 (major), 5265-70 (major)
Major Resistances: 5302-06 (major), 5328-30 (major)
Trading Strategy
Post-Breakout Dip Anticipated: The market is overdue for a healthy pullback after the recent strong surge.
Long Opportunities: Focus on failed breakdowns at 5202 or 5188-91 for long entries. In the event of a deeper pullback, consider buying the retest of the breakout zone at 5143-36 or knife-catches at 5168 for quick scalps.
Short Opportunities: Look for back-tests of 5246 or 5265-70 for short entries, targeting level-to-level profits. Proceed with extreme caution and be ready to cut losses quickly. Remember, shorting against strength in a bull market is inherently risky.
Focus on Levels and Patience: Trade the provided support and resistance levels rigorously. Let price action develop, be patient, and avoid emotional trading.
Bull Case
Holding Support: Defending the 5143-36 breakout zone remains crucial for maintaining bullish momentum. Holding above this level would indicate a healthy dip and a potential continuation higher.
Rebase and Bounce: A period of consolidation around 5190-5224 and a rebound off these supports would set the stage for further advances, potentially targeting 5246, then 5265-70.
Bear Case
Breakdown Signals: A convincing break below 5188-91 would signal a potential pullback and could lead to a retest of the 5143-36 breakout zone. Monitor bounces/failed breakdowns at these levels for potential short entries.
News: Top Stories for May 8th, 2024
Global Stock Market Trends:
Varied Performance: Asian markets show resilience despite Nikkei 225 drop, influenced by mixed corporate news.
U.S. Economic Indicators: U.S. jobs report and Fed's interest rate decisions continue to influence global markets positively.
Geopolitical Tensions: Market responses to geopolitical unrest remain muted, highlighting diversified global economies' resilience.
Company Earnings and Forecasts:
Earnings Performance: Uber reports Q1 loss; Thomson Reuters shows strong revenue growth.
Financial Forecasts: Taboola expects significant YoY growth; Thomson Reuters adjusts full-year outlook.
Sector-Specific Insights: Technology and financial services sectors demonstrate strong growth potential despite operational losses.
Analysts' Perspectives:
Setting Market Expectations: Analysts forecast earnings based on economic indicators, trends, and company guidance.
Implications for Investors: Earnings reports influence market sentiment and investor confidence, impacting stock prices.
Impact on Currency Values:
Political Events: Geopolitical tensions historically impact currency fluctuations, yet recent responses remain subdued, reflecting diversified global markets' resilience.
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