4/1 Daily Market Note: Prelim Q2 Watchlist of Stocks that Still Have Value
Prelim Q2 Watchlist
Hi Everyone -
Welcome back from the Easter Holiday weekend.
Today’s market session was very action packed with large Bi-Directional moves that suggests to me that stocks are in a very contested area right now (especially tech).
What we’ll do today is review our pre-market note, compare it with the intraday session so far, and then go on to provide a list of Sector Rotation ideas that still have value and offer safer upside from here.
Summary of what I was looking for:
After reversing much of the overnight advance, I was looking to see if NQ (Nasdaq-100) could bounce at 18500 from a first test. This was a key reaction level for me. The low before the market’s opening bell was 18470 and we then rallied +100 points back to 18600 before reversing lower.
18560 has been a real issue in terms of recent resistance for the Bulls on NQ. I shared this resistance with members this morning and it proved to be a valuable area to watch for (we flushed -100 points lower) not too long after it was reached. Once this area clears in the future, we head higher.
Here’s how folks can use my work from my pre-market updates:
Passive Investors: My intraday levels on the index will eventually give way to higher confidence in terms of our Stock Selection and Upside Parameters. I personally think that being able to read the intraday context of ES/NQ on a consistent basis will help an investor find better levels for Stocks in their long-term portfolio. After all, the longer-term picture is actually built by day-by-day action. My methodology to scalp ES/NQ combined with my DCF Conclusion Studies is how I find ideas like AMD at 180 (saw 187 today), MU at 95, FIVE at 175, DLTR second entry at 125, and LULU at 395 (on earnings day for a trip to 410). Having a trader’s toolbox can allow for better Entries for long-term positions.
Active Investors: Let’s say you trade SPY or QQQ (directly or options) or stocks on an intraday basis. Well, given that SPY/QQQ make the same exact move after ES/NQ, by knowing a helpful ES/NQ level, I do my best to help to avoid our active members buying at Day’s highs or Selling at Day’s lows. Given the high correlation of stocks together with the index, having this type of context can be helpful. I share 1 pre-market plan deliberately Before the opening bell. This is very intentional. Nothing is after-the-fact.
That being said, all I can do is put forth my best effort. Over a longer period of time, I think folks who are able to make the leap from Beginners to more Advanced investors will really benefit from what I’m doing.
I believe the landscape is ripe for sector rotation as market breadth gives other sectors a chance to perform outside of the tech sector. Tech is still in favor for now, but I wanted to be proactive about other companies.
With many names trading at extraordinarily overbought levels (>75 RSI), it’s time to be selective about what companies still have upside from here.
Here is my preliminary watchlist - with key levels I’m watching to scale-in along with upside targets. This list will grow as pullbacks come.