7/18/2020 Overall market is up this week, but QQQ drops. Thinking of going long on $TSLA, $NFLX, $SQ, $NIO if the market drops (or these stocks drop).

Welcome back to the blog! 

Stocks are still mostly grinding sideways or up slightly. Below is the weekly chart of SPY.

SPY weekly 7_18_2020

I don’t like prices up here for going long unless I was doing short weekly trades (less than 2 month holds). Over any longer time period (>2 months) and I think we are more likely to be lower than higher, we will see what happens. I’d want to be long near 300 and 275 for medium term swings (~3 month hold). Below I discuss some pullback trades I plan to go long on if SPY does pullback another 7% (to 300) and 15% (to 275). 

I’m considering going long on Tesla, Netflix, Square, and/or Nio on any more sustained weakness for a short/medium term swing trade. For example, although I don’t like Tesla from a fundamental perspective at all, the trend is still up, and once they report earnings next week, it could present a nice “buy the dip” opportunity for a swing trade back up. 

Same goes for Square, Nio and Netflix – although I think they are extremely expensive from most metrics, they present good short/medium term swing trading opportunities. 

I plan to hedge my bets with a couple of shorts in the technology sector to reduce my overall sector risk when going long though. Below are the charts of Tesla, Netflix, Square, and Nio, and where I plan to enter.

Tesla daily chart below (long at 900-1000): 

TSLA daily 7_19_2020

Netflix daily chart below (long at 400-450): 

NFLX daily 7_19_2020

Square daily chart below (long in 80-90 range):

SQ daily chart 7_19_2020

Lastly, Nio daily chart below (long at 8-9):

NIO daily 7_19_2020

Enjoy the rest of the weekend, and see you next week (unless we get a large market sell-off and I swing long 🙂